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Enterprises need to be pro-active during the pandemic



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



PMI back above 50 mark for first time in six months

Vietnam’s manufacturing sector returned to growth in August as some signs of recovery in demand supported renewed increases in both new orders and production.



The PMI moved back above the 50.0 mark for the first time in six months during August. At 50.5, the index was up from 48.7 in July and pointed to a marginal monthly improvement in business conditions in the sector.

Firms expanded their purchasing activity accordingly, but employment continued to fall marginally as firms were reluctant to take on extra staff given still fragile demand.

Renewed increases in prices were also recorded midway through the third quarter. Input costs rose for the first time in four months, while selling price inflation was signaled for the first time since March.

According to S&P Global, the nascent recovery in the health of the sector reflected tentative signs of demand improving.

Manufacturers recorded a first increase in new orders for six months, while new export business also rose following a five-month sequence of decline. Growth rates were modest, however, amid some reports of ongoing demand fragility.

Similarly, manufacturing production returned to growth in August, ending a five-month period of falling output. However, the rate of increase was only marginal.

Recoveries in output and new orders were most keenly felt in the investment goods category.

Firms responded to higher new orders and greater output requirements by expanding their purchasing activity at a solid pace. The rise was the first in six months and most pronounced since last September. In turn, stocks of purchases also increased, the second month running in which this has been the case.

The picture for employment was less positive, however, with row. That said, the pace of reduction was the weakest in this sequence and only marginal.

Ongoing reductions in employment reflected continued signs of spare capacity in the sector, with backlogs of work decreasing for the eighth consecutive month.

Firms also recorded a build-up of stocks of finished goods for the second month running amid some reports that weak demand had left finished products unsold.

August data pointed to a solid increase in input prices, thereby ending a three-month period of decline. A number of panellists linked higher input costs to rising oil prices, while increased food prices were also mentioned. In turn, firms also raised their own selling prices, albeit only slightly. The increase in charges was the first since March.

Suppliers’ delivery times shortened for the eighth successive month as stocks at suppliers remained sufficient to deal with orders despite a pick-up in demand for inputs during August. The improvement in vendor performance was solid, albeit the least marked since May.

Tentative improvements in market demand helped to strengthen business confidence midway through the third quarter, with firms hoping for a continued recovery in the months ahead. Optimism in the 12-month outlook for production was the highest in five months, but still below the series average amid ongoing concerns around the strength of demand.

Andrew Harker, economics director at S&P Global Market Intelligence, said that the latest S&P Global Vietnam Manufacturing PMI paints a more encouraging picture regarding the health of the sector than had been the case in recent months, with output, new orders, exports and purchasing all returning to growth.

Improvements were generally still quite muted, however, as demand conditions remained fragile. It is probably too early to say, therefore, that the sector is in full recovery mode.

Another key aspect from the latest survey was the end of the recent period of falling prices, with both input costs and selling charges up in August, often linked to higher oil prices, he said.

Source: Nhân Dân


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Property market expects money inflows following lending rate cuts

Continuous interest rate cuts and support policies are gradually proving effective, helping ease difficulties facing the real estate market, experts have said.



Since the start of 2023, the State Bank of Vietnam has continuously reduced policy interest rates, by a total of 0.5-2 percentage points per year. It has also ordered credit institutions to minimise expenses to lower lending interest rates to aid businesses, people, and economic recovery.

The Government, ministries, and sectors have also issued an array of other support policies to remove bottlenecks in the economy.

These factors have been providing a boost for the real estate market to recover faster, more safely, and more sustainably, which also indicates that support policies are gradually proving useful, experts opined. 

Dr Can Van Luc, Chief Economist at the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) and member of the National Financial and Monetary Policy Advisory Council, held that the property market underwent the most trying time, including financial difficulties caused by corporate bond-related problems.

The market has been gradually bouncing back since May, with the second quarter recording better results than in the first quarter. Industrial parks now have an occupancy rate of 76%, he noted.

Investors said prices of real estate stocks have increased 18% and construction tickers 39%. Procedural and legal obstacles facing many real estate projects have also been tackled.

Interest rates have returned to the levels in the first half of 2022.

Specialists of the WiGroup JSC, which provides economic data and fintech solutions in Vietnam, forecast the property market will witness observable improvements from late 2023 or early 2024. Compared to the pre-pandemic period, developments in the market at present are similar to those in 2014-2015.

They pointed out that the investor sentiment has improved, procedures related to investment procedures been removed, interest rates slashed, lending ceiling limits raised, and public investment disbursement accelerated while consumption and tourism stimulated. These factors are fueling real estate transactions.

Lower interest rates will be the main driver for the property sector. While deposit interest rates have been reduced since Q1, lending rate cuts are slower but still continue. Besides, a more favourable legal corridor has also helped facilitate real estate supply, according to WiGroup.

Nguyen Quoc Anh, Deputy Director General of – an online property trading platform, said if deposit interest rates continue to drop to under 10% by the end of this year, the money people put into their deposit accounts in late 2022, when deposit interest rates surged, will be withdrawn and channelled into the market.

Echoing the view, Chairman of the Vietnam Association of Realtors Nguyen Van Dinh perceived that if lending interest rates for both new and old loans decline, the financial pressure on investors will ease. Besides, if deposit interest rates are brought down to under 5%, money will return to real estate and foster transactions in the market.

Source: Vietnamplus


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Singapore’s Soilbuild Group Holdings to invest $45 mln in Nghe An

Nghe An province licenses Soilbuild Group Holdings Pte to develop a system of ready-build factories and offices located in WHA Industrial Zone 1.



The provincial authorities delivered the document to the firm last week as part of the “Tapping Opportunities in Nghe An Province of Vietnam to Expand and Grow Your Business” conference in Singapore. The event was hosted by Nghe An authorities, the Vietnamese Embassy in Singapore, and the Singapore Business Federation.

At the conference, the Deputy Chairman of Nghe An People’s Committee Bui Dinh Long,  expects the Vietnamese Embassy in Singapore to continue promoting cooperation between both sides, particularly, prioritized in sectors of trade, education, training, high technology, tourism, and others, Long said.

Nghe An confirmed Singapore is one of the top partners for economic cooperation and investment. So far, there are 124 foreign direct investment projects, with a total registered capital of $3.3 billion. Meanwhile, seven projects come from Singapore investors with a total committed investment of over $488.41 million, creating jobs for more than 10,000 workers.

In addition, Nghe An province has experienced rapid growth in recent years, with an average annual growth rate of over 9% per year. This places it among the top 10 localities in the country for foreign investment capital, and in the top 8 localities for FDI in the first half of 2023.

The province gained a revenue of $29.95 million from exporting goods to Singapore in the first half of the year, exceeding the achievement of $29.03 million in 2022. Accordingly, the import turnover increased by $58.78 million in the first half of 2023 compared to the whole year of 2022. 


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