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VIETNAM BUSINESS NEWS DECEMBER 23

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China suspends goods import via border gates in Mong Cai 

The Customs Division of Mong Cai City, Quang Ninh province, has informed that China released a formal announcement about the suspension of customs clearance in its side of the border gates sited in Mong Cai City due to Covid-19 case detection. This decision is to serve tracking tasks for Covid-19 prevention purposes.

Because of this customs clearance suspension, it is expected that 1,500 container trucks will be stuck in Mong Cai City, most of which are transporting fruits, frozen seafood, handicrafts. The localities, as a result, have arranged more temporary parking lots in Luc Lam area to minimize potential traffic congestion.

The two border gates of Tan Thanh and Chi Ma in Lang Son Province are now experiencing temporary closure as well. Being the only active one, Huu Nghi border gate is seeing a very slow traffic flow.

Additional 200 hectares of land to be handed over for Long Thanh airport project

The Dong Nai government has decided to hand over some 200 more hectares of cleared land to the Southern Airports Authority to develop the first phase of the Long Thanh International Airport project.

This is the second time the province has handed over cleared land for the project, the local media reported.

Earlier in October 2020, Dong Nai Province handed over 1,280 hectares of land to the Southern Airports Authority for the construction of the project. The Long Thanh International Airport project will cover 5,000 hectares of land.

Vietnam’s animal feed export surpasses 1 bln USD for first time hinh anh 1

Vietnam’s animal feed export surpasses 1 bln USD for first time

Vietnam’s export of animal feed and materials surpassed 1 billion USD for the first time to 1.049 billion USD from early this year to mid-December, reported the General Department of Vietnam Customs.

The figure topped 81 million USD in the first half of December.

The biggest importer was China with an export turnover of more than 330.73 million USD, or 34 percent of the country’s total exports, up 75.6 percent annually.

Cambodia came second with 137.41 million USD, up 22.7 percent year-on-year, equivalent to 14.1 percent.

The third largest market was India with 95.86 million USD, marking an annual increase of 36 percent and accounting for 9.9 percent.

In 11 months of this year, Vietnam’s export to several markets hiked compared to the same period last year. Its earnings from the Philippines soared by 165.3 percent to 69.13 million USD while those from Thailand surged by 78.2 percent to 28.65 percent. 

Trade exchange held to connect Japanese, Vietnamese firms

Vietnam Trade Promotion Agency (Vietrade) under the Ministry of Industry and Trade in collaboration with the Vietnam Trade Office in Japan on December 23 organised a trade exchange to connect businesses of Vietnam and Japan in the field of food processing. 

The total import-export turnover between Vietnam and Japan reached 38.4 billion USD in the first 11 months of this year, up 7 percent over the same period last year. Notably, Japanese investment capital into Vietnam increased by 54 percent against last year’s figure.

The fact that the two countries are members of many free trade agreements including the Vietnam-Japan Economic Partnership Agreement (VJEPA), Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and Regional Economic Partnership Agreement (RCEP), creates many opportunities to expand trade cooperation, especially participating in the regional and world’s supply chain. 

Vietnam, Australia eye stronger trade, investment cooperation

The governments of Vietnam and Australia have announced the Australia-Vietnam Enhanced Economic Engagement Strategy and a roadmap to promote trade and investment ties between the two countries in the 2021 – 2025.

In the first ten months of 2021, the two-way trade reached an estimated 10 billion USD, up about 50 percent year-on-year.

The two countries have built a reliable partnership, and ready to help each other in crises and unstable developments. The latest evidence is Australia’s support activities for Vietnam in preventing the COVID-19 pandemic and promoting the recovery of green economy during the health crisis.

In addition to economic ties, Vietnam and Australia are increasingly connected in social and cultural aspects. Nearly half a million people of Vietnamese origin are living in Australia, This is an important cultural and economic bridge between the two countries. 

Vietnam, RoK foster on trade, industry, energy cooperation

Vietnamese Minister of Industry and Trade Nguyen Hong Dien and the Republic of Korea (RoK)’s Minister of Trade, Industry and Energy Moon Sung-wook co-chaired the 11th meeting of the Vietnam-RoK Joint Committee on trade, industry and energy cooperation and the 5th meeting of the bilateral Joint Committee on implementation of the free trade agreement between the two countries on December 22.

Following the two meetings, the two ministers signed four documents, including a memorandum of understanding between the Ministry of Industry and Trade and Ministry of Trade, Industry and Energy on middle and long-term cooperation in commercial urea for industrial use.

During Vietnamese National Assembly Chairman Vuong Dinh Hue’s visit to the RoK, leaders of both sides agreed to work together towards the target of 150 billion USD in two-way trade in 2030 with trade balance.

Reference exchange rate up VND10 

The State Bank of Vietnam set the daily reference exchange rate at 23,193 VND/USD, up 10 VND from the previous day.

With the current trading band of +/-3 percent, the ceiling rate applicable to commercial banks during the day is 23,888 VND/USD and the floor rate 22,497 VND/USD.

Bidding contract for Phuoc Thai 2, Phuoc Thai 3 solar power plants signed

A signing ceremony for the bidding contract No.3 in the form of engineering, procurement and construction (EPC) for Phuoc Thai 2 and Phuoc Thai 3 solar power plants took place in Hanoi on December 22.

Signatories were the Power Project Management Board No.2 and joint venture between Hong Kong’s Risen Energy Co.Ltd and Vietnam’s Tasco JSC.

Located in the south central province of Ninh Thuan, the plants are invested by the Vietnam Electricity and managed by the Power Project Management Board No.2, connecting with the national grid via a 220kV line.

As scheduled, they will generate electricity by the third quarter next year. Once completed, they are expected to add over 247 million kWh to the national grid.

Room for Vietnam’s exports to Eurasia remains huge

The Ministry of Industry and Trade’s Department of European – American Markets held a trade cooperation forum with Eurasian partners both online and offline on December 22.

Despite COVID-19 pandemic, two-way trade between Vietnam and Eurasia still hit 12.7 billion USD in 11 months of this year, up 13.1 percent annually. Of the figure, 8.6 billion USD was Vietnam’s export which remained modest compared to their import demand of more than 1.34 trillion USD, or only 0.66 percent of the market share, showing that room for Vietnam’s exports remains huge.

As of the late November, 18 out of 28 regional countries invested in 319 projects worth nearly 1.78 billion USD in Vietnam, or 0.44 percent of the total foreign direct investment in the country.

Meanwhile, Vietnam poured around 2.82 billion USD in 37 projects in nine regional nations as of the late September. Russia was the biggest recipient of Vietnamese investment with 15 projects valued at 2.8 billion USD.

Meta helps Mekong Delta agro-fishery firms in digital economy

The Vietnam Chamber of Commerce and Industry (VCCI) and Facebook Group (now Meta) held a webinar on December 22 to discuss improving competitiveness of agro-fishery firms in Can Tho’s digital economy.

The event was part of Boost with Facebook programme to assist the Vietnamese firms in the digital economy, attracting over 100 delegates from local authorities and agro-fishery firms in Can Tho and the Mekong Delta.

Participants at the event raised questions to speakers about the application of digital technology to restore production and access customers, and sectoral development strategy in the near future. It is the fifth year the VCCI has cooperated with Meta to carry out the programme in Vietnam.

PM requests better efficiency of ODA use

The Prime Minister has assigned the Ministry of Planning and Investment to draft strategies and policies on development cooperation with foreign donors in order to improve the efficiency of using official development assistance (ODA) and concessional loans.

The ministry is also tasked with being in charge of clarifying orientations for attracting, managing and using ODA and concessional loans from foreign donors; and for drafting and submitting for promulgation or promulgating legal documents on the such management according to its competence.

Vietnamese association in Vientiane helps Laos build SMEs promotion department’s building

Construction of a building of the small and medium-sized enterprise promotion department in the campus of the Lao Ministry of Industry and Trade, funded by the Vietnamese Association in Vientiane capital, commenced on December 22.

This is a project to implement an agreement on exchanging public land use rights signed between the association and the Lao Ministry of Industry and Trade. The five-storey project has a total investment of 1.1 million USD. Covering an area of 2,500 sq.m, the building is designed to meet the working demand of more than 200 people. The project is expected to be completed after 18 months.

Vietnam, RoK firms look to boost trade in apparel, footwear

The Republic of Korea (RoK) is the largest investor in the textile – garment and leather – footwear industries of Vietnam, which holds considerable chances to boost the export of these commodities to the Northeast Asian market, heard a recent teleconference.

The RoK is currently one of the leading economic partners of Vietnam, ranking first in foreign direct investment and third in trade with the latter last year.

Bilateral trade reached 63 billion USD in the first 10 months of 2021, up 17.6 percent year on year. That included 17.9 billion USD of Vietnamese exports, rising 11.5 percent.

Vietnam shipped 26.9 billion USD worth of textile – garment and 14.24 billion USD worth of leather – footwear products to the RoK during the period. The full-year figures are forecast to hit 33.9 billion USD and 18.52 billion USD, respectively.

FTAs unlock opportunities for Australian investment increase

Australia’s investment in Vietnam would grow further in the coming time thanks to free trade agreements (FTAs), heard a workshop held virtually in Hanoi on December 22.

The Australian investment in the Southeast Asian nation now remains modest, said Nguyen Thi Thu Trang, Director of the Vietnam Chamber of Commerce and Industry (VCCI)’s Centre for WTO and Economic Integration, citing statistics by the Foreign Investment Agency at the Ministry of Planning and Investment as showing that by November 2021, Australia had run 545 projects worth 1.94 million USD in Vietnam.

The capital accounts for only 0.5 percent of the total FDI poured into Vietnam, making Australia rank 19th among countries and territories investing in Vietnam, she added.

However, Trang said, the two countries share three FTAs, including two new-generation ones, namely the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP).

Businesses eager to use e-invoices

As many as 263,182 businesses registered to use e-invoices after one month of piloting e-invoices in six provinces and cities, accounting to 71 percent of the total enterprises and organisations in the localities, according to the General Department of Taxation (GDT).

To prepare for the implementation of the second phase in the remaining 57 localities from April 2022, the GDT said it is accelerating the completion of institutions, policies, and professional processes related to e-invoice, focusing on reviewing problems arising in the application process of e-invoices in six provinces and cities in the first phase, and proposing suitable adjustments.

The GDT sets the goal of having 100 percent of businesses in Vietnam use e-invoices until June 30, 2022.

Eco-Fair project achieves most of the initial goals

Under the framework of the project “Promotion of supply and demand of Eco-Fair Agri-food processing products in Viet Nam” (Eco-Fair), co-financed by the European Union with EUR 1.5 million through the EU’s SWITCH-Asia Programme, Viet Nam Rural Industries Research and Development Institute (VIRI) held an online policy dialogue on “Promotion of Supply and Demand of Eco-Fair Agri-Food Products” on Tuesday.

The policy dialogue shared some results and initial impacts of the Eco-Fair project that promotes Sustainable Consumption and Production (SCP) practices in eco-fair agri-food product supply chains, which contributes to the development of sustainable livelihoods and circular economy in Viet Nam.

The Eco-Fair project targets micro, small and medium enterprises (MSMEs), consumer groups in agri-food processing sectors, as well as business intermediaries and relevant government authorities.

NAPAS and BIDV partnership launches DFS acceptance services

Cardholders with global payments brand Discover® Financial Services (DFS) will have more options to make payments at merchants throughout Viet Nam.

This implementation is under the Network Alliance agreement between the National Payment Corporation of Viet Nam (NAPAS) and Discover Global® Network (DGN). BIDV is the first member of NAPAS to enable DGN acceptance at merchants in Viet Nam.

Fitch affirms outlook on Standard Chartered Vietnam as positive

Fitch Ratings has affirmed the outlook on Standard Chartered Bank (Vietnam) Limited as positive, with long-term foreign currency and local currency issuer default ratings at BB and BBB respectively.

Fitch’s ratings are driven by institutional support from 100 per shareholders, with Standard Chartered Vietnam given an important role in the group’s broader South-East Asia strategy.

The ratings are capped by a potentially higher Country Ceiling should the sovereign rating be upgraded.

Vietnam’s animal feed export surpasses 1 billion USD for first time

Vietnam’s export of animal feed and materials surpassed 1 billion USD for the first time to 1.049 billion USD from early this year to mid-December, reported the General Department of Vietnam Customs.

The figure topped 81 million USD in the first half of December.

The biggest importer was China with an export turnover of more than 330.73 million USD, or 34 percent of the country’s total exports, up 75.6 percent annually.

In 11 months of this year, Vietnam’s export to several markets hiked compared to the same period last year. Its earnings from the Philippines soared by 165.3 percent to 69.13 million USD while those from Thailand surged by 78.2 percent to 28.65 percent.

State capital to be less than half of investment in Ring Road 4’s PPP subproject

The Government has sought that the State capital poured into a subproject conducted under the public private partnership (PPP) model of the Ring Road No. 4 project, which will pass through Hanoi, Hung Yen and Bac Ninh, should not exceed half of the total investment in the subproject.

Accordingly, the Ring Road No. 4 project was included in the road system development plan in the 2021-2030 period with a vision to 2050 and was approved by the prime minister on September 1, 2021. The project was aimed at reaching the target of having some 5,000 kilometers of expressways by 2030.

To ensure that the project will be submitted to the National Assembly for approval at its sitting in May next year. The Hanoi government was asked to submit a proposal on the appraisal of the project to the Government and the Ministry of Planning and Investment before December 25.

16 coal transit ports proposed to serve thermal power projects

The Ministry of Industry and Trade and consulting firms have proposed the prime minister choose locations to develop 16 coal transit ports to serve coal-fired power projects to complete the national electricity development plan in the 2021-2030 period with a vision to 2050.

According to Deputy Minister of Industry and Trade Dang Hoang An, to serve large coal-fired power projects, five ports will be developed in the northern and north-central regions, including Hon Net in Quang Ninh, Tien Hai in Thai Binh, Hon Me in Thanh Hoa, Son Duong in Ha Tinh and Quang Trach in Quang Binh.

Eleven other ports should be developed in the southern and south-central regions, consisting of Vinh Tan in Binh Thuan, those on the Go Gia River and the Ong Cho Island in HCMC, Soai Rap in Tien Giang, Duyen Hai in Tra Vinh, My Thanh in Soc Trang, Ganh Hao in Bac Lieu, Hon Khoai in Ca Mau, one on the Nam Du Island in Kien Giang, Con Dao in Ba Ria-Vung Tau and Nam Van Phong in Khanh Hoa.

Father of ST rice variety asks for brand protection domestically

The Ministry of Industry and Trade, on December 22, informed that the family of Mr. Ho Quang Cua – the father of ST24 and ST25 rice varieties that won the 2019 World’s Best Rice award – had submitted an application to the Market Surveillance Authority, asking for brand protection of these two rice varieties in the Vietnamese market.

After receiving the application from Mr. Ho Quang Cua’s family, the Market Surveillance Authority issued a document directing the Market Surveillance Agencies of provinces and cities to review and verify the contents reflected by the enterprise in the application about establishments alleged to have violated in the areas under their management.

Previously, the ST24 and ST25 rice trademarks were taken by some enterprises in the US and Australia to register trademarks in these countries.

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

Source: https://vietnamnet.vn/en/business/vietnam-business-news-december-23-803589.html

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Vietnam remains attractive destination to international investors: HSBC survey

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Vietnam keeps being an attractive investment environment for global investors, with many Indian and Chinese enterprises saying they plan to expand their business in the Southeast Asian country in the next two years, according to an HSBC survey. 

The UK-based HSBC Holdings plc (HSBC), one of the largest banking and financial services institutions in the world, has recently released the results of a large survey of nearly 1,600 companies from six of the world’s largest economies all of which have operations in Southeast Asia.

The survey, ‘HSBC Navigator: Southeast Asia (SEA) in Focus,’ covered 1,596 companies from the U.S., the UK, China, France, Germany, and India.

Survey respondents were key decision-makers from companies already doing business in SEA or those considering doing so.

These international businesses have strong expectations for continued growth in SEA, including Vietnam, which “has been striding forward in recognition and application of the sustainability agenda.”

About 21 percent and 26 percent of Indian and Chinese firms operating or intending to operate in SEA, respectively, said they plan to expand their business in Vietnam in the next two years.

In respect of Vietnam’s advantages, three out of ten businesses pointed to a skilled workforce, while 27 percent cited competitive wages and proven economic resilience in response to the COVID-19 pandemic.

Forty-nine percent of the Indian companies surveyed said they were enthusiastic about Vietnam’s supportive government and regulatory environment, while the corresponding rates of the American and Chinese firms are 33 percent and 30 percent.

Encouraged by Vietnam’s regulatory environment, 36 percent of the American companies in the poll said that they were keen on opportunities to develop and test new products and solutions in the market.

Meanwhile, 39 percent of the Indian companies stated they were attracted by Vietnam’s infrastructure.

Notably, 49 percent of the firms polled, mostly from China, India, and the U.S., expressed their hope to make use of the EU – Vietnam Free Trade Agreement (EVFTA) to further promote their trade operations in the region.

Being attracted by the supply chain ease and social and political stability of Vietnam, a quarter of the German respondents selected both as positive features of the Vietnamese market.

“Vietnam has been striding forward in recognition and application of the sustainability agenda to become a regional leader in its progress toward achieving the 17 United Nations Sustainable Development Goals (SDG),” HSBC said in the survey.

Ranked 51st out of 162 countries by the SDG Index, Vietnam is thus rated as having greater success than all other Southeast Asian countries barring Thailand, according to the poll.

However, some 31 percent of the respondent enterprises operating in Vietnam worried that new regulations and rules on carbon reduction could impact them, while 36 percent flagged the difficulty in hiring employees who possessed the correct sustainability credentials and knowledge.

Vietnam’s GDP growth is expected to make an impressive recovery over the course of 2022, likely reaching a 6.2 percent progression following a 2021 low of 2.6 percent, HSBC forecast.

The country is rising as a global production hub thanks to the incentives given by the government, especially in the signing of free trade agreements, HSBC Vietnam CEO Tims Evans said.

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Source: https://tuoitrenews.vn/news/business/20220528/vietnam-remains-attractive-destination-to-international-investors-hsbc-survey/67346.html

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Intel plans to expand investment in Vietnam

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American technology company Intel has plans to broaden business and investment activities in Vietnam following the country’s good management of the COVID-19 pandemic, the Vietnam Government Portal (VGP) quoted Intel CEO Patrick Gelsinger.

The Intel executive made the statement at a meeting with Vietnamese Prime Minister Pham Minh Chinh in Hanoi on Friday.

Vietnam is an attractive destination for foreign investors as it is a vibrant economy and a promising market, CEO Gelsinger said.

He highlighted that Vietnam remains a charming investment destination in the eyes of foreign investors thanks to its dynamic economy, potential market, and industrious population.

He appreciated the Vietnamese government’s efforts in creating favorable conditions for foreign investors, particularly its support for Intel to maintain production amid the pandemic time.

Chinh, who visited Intel’s headquarters in California earlier this month, praised semiconductor chip manufacturer’s investment activities in Vietnam over the past 15 years.

Intel’s assembly and test factory, located in Saigon Hi-Tech Park in Ho Chi Minh City, became the U.S.’s biggest high tech project in Vietnam.

Since it came into operation in 2010, the factory has generated hundreds of jobs and consolidated Vietnam’s status in the global semiconductor supply chains.  

Chinh recommended that Intel build a research center in Vietnam and assist the Southeast Asian nation in building up a startup and innovation ecosystem and high-quality workforce.

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Source: https://tuoitrenews.vn/news/business/20220528/intel-plans-to-expand-investment-in-vietnam/67342.html

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E-bike buyers face serious sticker shock amid rising gasoline prices

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Increased fuel prices are wreaking havoc across the transportation industry in Vietnam as costs of once wallet-friendly alternatives, such as e-bikes, ride-hailing services, and budget airlines all steadily rise as a result.

To combat the problem, the government is considering proposals to cut taxes on gasoline and oil, according to the National Assembly (NA).

Ripple effect

Nguyen Tri, sales manager for electric bike brand PG, explained that the increased price of e-bikes and e-scooters is due to the rising costs associated with transporting the bikes to sales outlets and distributors.

According to Tri, PG had resisted raising rates at the beginning of the year despite spare part shortages and rising transport costs, but once fuel in Vietnam surpassed VND30,000 (US$1.28) per liter and transport operators hiked fees by 10 percent in March, the firm was left with no choice.

“The increased prices of input materials, such as aluminum, steel, and electric wires have forced the prices of spare parts up by 10 to 20 percent,” Tri explained, adding that the hike in fuel prices has left an enormous impact on the firm’s post-pandemic recovery.

The freight industry has faced the same fate.

Nguyen Kim Thanh, director of Kim Phat Transportation Company in District 12, Ho Chi Minh City, said that record-high fuel costs are creating serious struggles for her firm as it attempts to renegotiate with customers. 

The on-demand delivery sector is also confronting woes as a result of the rising cost of fuel, coupled with a decrease in demand, with Grab, GoJek, and Be drivers all struggling to earn a living.

Many are now considering looking for new jobs, including Nguyen Phuc Bao Chau, a student from Bach Viet College in Ho Chi Minh City, who is a part-time delivery worker.

“I am thinking about quitting my current job and seeking a new one because of soaring gasoline prices and sluggish demand,” Chau said.

More expensive fuel has also placed an undue burden on local airlines, including Vietnam Airlines, Vietjet Air, Bamboo Airways, and Vietravel Airlines.

A commercial deputy director of a local air carrier told Tuoi Tre (Youth) newspaper that airlines’ business operations remain slow although the aviation sector is showing positive signs of recovery.

Some nations are still limiting the number of air passengers aboard inbound flights, in some cases lowering flight capacities by up to 50 percent.

This, along with rising gas prices, is putting serious pressure on airlines.

If jet fuel continues being traded at $130 per barrel in 2022, the cost will add VND5.7 trillion ($245 million) over the course of the year, according to local airlines.

That number will jump to VND9.12 trillion ($392 million) if jet fuel hit $160 per barrel.

The way forward

Speaking about inflation, NA deputy Nguyen Manh Hung from Can Tho City, a permanent member of the NA Economic Committee, told Tuoi Tre that the spike in petrol and oil prices has become a hot topic as it stokes fears of high inflation.

To keep inflation under control, it is vital to reduce excise taxes on gasoline and oil.

In addition, it is urgent to refill the country’s petrol and oil reserves, while obstacles facing the Nghi Son refinery, which accounts for as much as 40 percent of the country’s fuel supply, should be removed soon, said Hung.

Fuel inventories at enterprises should also be addressed.

The prices of fuel will only stabilize when there is an abundant supply of gasoline and oil.

Furthermore, accelerating fuel rates have make food and foodstuffs more expensive. The prices of food are forecast to jump to over 20 percent in the near future.

The NA Economic Committee shared its support for the government’s plan to keep inflation below four percent and requested a clearer scenario for it amid economic growth.

The country’s economic growth target of 6-6.5 percent, plus relief packages for post-pandemic recovery, is expected to drive up inflation.

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Source: https://tuoitrenews.vn/news/business/20220528/ebike-buyers-face-serious-sticker-shock-amid-rising-gasoline-prices/67332.html

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