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VIETNAM BUSINESS NEWS JUNE 22

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Not feasible for e-commerce floors to declare and pay taxes for sellers: Vecom

VIETNAM BUSINESS NEWS JUNE 22

The Viet Nam e-Commerce Association (Vecom) said that a number of regulations in Circular 40 were not yet feasible, which could impact activities of hundreds of thousands of individuals doing business on e-commerce floors.

The association has just released a statement on new regulations related to e-commerce in Circular 40/2021/TT-BTC, which guides value added tax, personal income tax and tax administration for business households and individuals.

The circular was issued on June 1 and will take effect from August 1 to replace Circular 92/2015/TT-BTC.

The circular stipulated that commerce trading floors are responsible for declaring and paying tax on behalf of individuals doing business selling goods and services.

The amount of tax declared or paid is based on the tax rate of each field of business.

Circular 40 had many new contents compared to the draft first published March 12, but the drafting board had not yet collected comments from stakeholders and those directly impacted, Nguyen Ngoc Dung, Vecom vice chairman told a meeting last week.

Representatives of some units said that the e-commerce trading floor was not an “income payer” unit. They only provide technology infrastructures to connect sellers and buyers and help them make transactions.

Therefore, they are not subjects to declare and deduct income tax of sellers according to regulations.

In addition, business individuals would have to declare and pay tax at the tax office where their business located, while e-commerce platforms might have their business locations in other provinces, said e-commerce representatives.

Therefore, the declaration and submission on behalf of the company leads to conflicts with current regulations.

Vecom also said the expected roadmap to apply the requirements to the e-commerce floors on August 1 was too short to be able to prepare the system for data collection and report to meet the requirements of the tax authority.

Representatives of e-commerce floors expressed their hope that the tax authority would clarify specific requirements and application roadmap, and at the same time discuss with e-commerce floors to understand the difficulties encountered in reality.

On June 7, Vecom sent a document to the General Department of Taxation expressing concern about the feasibility and potential impacts of the regulation.

A Tiki representative told Viet Nam News they expected the tax authority to give detailed instructions to businesses on the plan to implement the circular, including steps to be taken, implementation time of each stage, and specific dispatches on calculation methods, tax and accounting declaration forms.

Secondly, the e-commerce platform realised that it would take more time to work internally, prepare systems, infrastructures, and equipment for data collection and reports following the request of the tax authority, as well as ensuring the security of the system.

In terms of operation, e-commerce floors also needed more time to work, guide and reach agreement with their brand partners and sellers to ensure close co-ordination, accurate implementation for circular issued by the Ministry of Finance. 

Shares edge down on selling pressure, foreign investors flee market

Shares ended lower on Monday as profit-taking activities weighed on the stock market, while foreign investors net sold more than a trillion Vietnamese dong on two main exchanges.

The market benchmark VN-Index fell 5.14 points, or 0.37 per cent, to 1,372.63 points. The index gained 1.93 per cent last week.

The market’s breadth was negative as 232 stocks declined and 173 stocks rose.

The liquidity was still high with nearly 768.2 million shares traded on HoSE, worth VND22.66 trillion (US$982.7 million).

The losses were driven by falls in pillar stocks. The VN30-index, which tracks the 30 biggest stocks in market capitalisation on the southern market, slid 0.2 per cent to 1,478.29 points. Seventeen of 30 stocks in the VN30 basket fell, while ten stocks climbed and three stocks ended flat.

Stocks in attractive sectors including banking, material and real estate led the market’s losses.

JSC Bank for Investment and Development of Vietnam (BIDV, BID) lost the most, down 2.49 per cent. Other stocks posting big losses were Hoa Phat Group (HPG), Vietcombank (VCB), Techcombank (TCB), Vietinbank (CTG) and Vietnam Dairy Products JSC (Vinamilk, VNM). All these stocks plunged more than 1 per cent on Monday.

The index pared some losses on gains in utilities, real estate, retail and infomation technology (IT) including the Viet Nam National Petroleum Group (Petrolimex, PLX), Mobile World Investment Corporation (MWG), No Va Land Investment Group Corporation (Novaland, NVL) and FPT Corporation (FPT).

According to an analyst from Bao Viet Securities Company, the benchmark is expected to move sideways with some up and down sessions in ranges of 1,374 – 1,385 points in the upper bound and 1,300 – 1,330 points in the lower bound.

“The market continues to witness strong division between stock lines at the moment. And cash flows will shift alternatively among small/medium-cap stocks or large-cap stocks that haven’t gained much in previous rallies,” the company added.

On the Ha Noi Stock Exchange (HNX), the HNX-Index fell 0.78 per cent to 316.24 points, weighed by losses in large-cap stocks. The HNX30-Index decreased by 0.65 per cent to 502.24 points.

During the session, over 144.1 million shares were traded on the northern bourse, worth more than VND3.2 trillion.

Meanwhile, foreign investors were net sellers on both exchanges, with a total value of VND1.13 trillion. Of which, they net sold a value of nearly VND1.1 trillion on HoSE, and a value of VND33.72 billion on HNX.

Shares to move up but investors should be cautious

Securities companies have forecast that the stock market’s uptrend may continue this week but investors should adopt risk management measures.

On the Ho Chi Minh Stock Exchange (HoSE), the VN-Index gained 1.31 per cent, to close Friday at 1,377.77 points, the highest milestone so far.

It gained 1.93 per cent in total last week.

An average of 770.9 million shares were traded on the southern exchange each session last week, worth VND23.9 trillion (US$1 billion).

According to SSI Securities Incorporation (SSI), the VN-Index has the impetus to continue towards the target of 1,400 points in the coming sessions.

“However, the buying force might increase when the index approaches the resistance zone of 1,400 points. Therefore, investors should focus on risk management during the index’s uptrend,” it said.

BOS Securities Joint Stock Company (BOS) said it was likely the VN-Index would maintain an increase and move towards a stronger resistance area at 1,380 – 1,400 points.

However, according to the company, the index may retest the old peak of 1,370 – 1,375 points in the early sessions of this week before confirming the short-term uptrend.

MB Securities Joint Stock Company (MBS) believes the market has recovered after the correction in the early sessions of June. The return of leading stocks like banks, securities and steel have helped VN-Index reach a new high.

“Technically, the market may enter a new bullish wave after successfully surpassing the old peak to move towards the short-term target at 1,420 – 1,450 points,” it said.

Viet Dragon Securities Joint Stock Company (VDSC) said at the end of last week, the VN-Index set a new peak with many stocks rising to new price ranges, boosting investors’ sentiment.

“The spread of smart money has not stopped,” VDSC said.

Saigon-Hanoi Securities Joint Stock Company (SHS) said the market rallied last week with reduced liquidity compared to the previous week, but still higher than the average level of the last 20 trading weeks.

“The buying demand is still relatively strong. However, there was more caution among investors than before,” it said.

“From a technical point of view, the VN-Index ending last week above the threshold of 1,375 points opens an opportunity for an extension of the uptrend with the target around 1,400 points,” it said.

“However, the index’s gaining momentum over 1,375 points is not definitive and the liquidity dropped. Therefore, it is still necessary to observe more movements in the session on June 21 to assess the trend of the VN-Index,” it said.

Energy stocks gained the most last week, mainly thanks to the increase of pillars such as PetroVietnam Gas JSC (GAS) up 6.6 per cent, PV Power (POW) rising 2.1 per cent, Binh Son Refinery (BSR) increasing 8.8 per cent, Vietnam National Petroleum Group (PLX) climbing 4.6 per cent and PV Oil (OIL) up 3.5 per cent.

They were followed by materials stocks, including Phu My Fertilisers (DPM) up 7.5 per cent, Hoa Sen Group (HSG) up 7.3 per cent, Petro Viet Nam Ca Mau Fertilizer JSC (DCM) rising 6.6 per cent and Nam Kim Group (NKG) gaining 4.2 per cent.

The financial group also performed well with gainers like Viet Capital Incorporation (VCI) up 14.4 per cent, Saigon-Hanoi Securities Co (SHS) up 10.2 per cent, VNDirect (VND) rising 9.8 per cent and SSI Securities Co (SSI) up 2.7 per cent. 

Credit expands quickly in H1, central bank might consider credit room extension

With credit expanding quickly in the first half of this year, the State Bank of Viet Nam (SBV) said in its press conference on Monday that the credit growth target for the full year of 2021 at 12 per cent was within reach and it might consider extending credit room if necessary.

SBV’s statistics showed that despite the pandemic, credit growth reached 5.1 per cent as of mid-June against the end of 2020, more than doubling the rate of 2.26 recorded in the same period last year.

This meant that banks pumped a net value of VND468.8 trillion (US$20.2 billion) into the economy in the first six months of this year through lending.

Deputy Governor Dao Minh Tu said that the central bank always asked credit institutions to focus on providing capital for production and prioritised sectors while tightly controlling credit flow into risky sectors.

At the same time, banks were asked to remove difficulties in credit access and creating favourable conditions for enterprises and citizens to borrow money from banks.

“With such strong credit growth in the first half of this year, the credit growth target for the full year which was set at 12 per cent was achievable,” Tu said. “If the pandemic is put under better control, the central bank might consider to extend credit room.”

Tu stressed that the central bank maintained a flexible monetary policy and ensured the system liquidity to stabilise the market and promote economic recovery amid the pandemic.

As of June 15, M2 money supply increased by 3.96 per cent against the end of 2020 and 14.27 per cent against the same period last year.

The liquidity of the credit institutions system was abundant and stable, Tu said.

Tu said the interest rates were generally kept at low levels in the first half of this year after three cuts in 2020. This aimed to reduce lending costs for citizens, enterprises and the economy.

As of April, annual deposit and lending rates were around 0.3 percentage points lower than the end of 2020. The maximum short-term lending rates of loans in Vietnamese dong for prioritised sectors was around 4.5 per cent per year while lending rate for USD averaged 3-6 per cent per year.

Regarding the support to enterprises and citizens who were affected by the COVID-19 pandemic, the central bank’s statistics showed that credit institutions have so far restructured debt payment deadlines for more than 257,600 customers with a total outstanding loan balance of more than VND336.66 trillion, reduced rates for more than 676,690 customers with a outstanding loan worth more than 1.2 quadrillion. New loans with low lending rates provided from January 23 to date were worth more than VND3.5 quadrillion.

Cashless payment also saw good growth. Online transactions rose by 65.9 per cent in volume and 31.2 per cent in value in the first four months of this year compared to the same period last year, via mobile by 86.3 per cent and 123.1 per cent, via QR Code by 95.7 per cent and 181.5 per cent, respectively.

Businesses team up with Bac Giang farmers in selling lychee

Bac Giang’s Tan Yen district has signed cooperation contract with six businesses in selling lychee, a specialty fruit of the northern province.

Of the businesses, Chanh Thu, Rong Do, Bamboo, Toan Cau and Ameii companies are exporting the fruit to Japan. The remaining firm sells lychee in domestic supermarkets. Meanwhile, Phuc Hoa lychee production and selling cooperative and 18 traders have also registered to sell the fruit to the Chinese market.

Earlier, the People’s Committee of Tan Yen issued a plan on the sale of early-ripening lychees meeting export standards in 2021, and another plan on organising a send-off ceremony to begin the shipment  of lychee to Japan, along with the formation of a working team directing the cultivation of lychees in accordance with export standards.

The district has directed relevant agencies to coordinate with the People’s Committee of Phuc Hoa commune to conduct survey and choose suitable areas as well as farmer households having sufficient conditions to engage in for-export lychee production, and giving advice to the communal authorities in the issuance of documents directing the production and supervising the lychee cultivation process under GlobalGAP standards. Meanwhile, consultancy agencies will be selected to evaluate the local soil and water conditions, serving the assessment and certification of product quality.

Tan Yen district also coordinated with the Bac Giang Department of Agriculture and Rural Development to invite five companies to visit the locality to get understanding on the district situation and its plan to sell lychee to Japan and the EU, paving the way for the district to sign selling contracts with those businesses.

In 2021, Tan Yen has 1,329 hectares of “thieu” lychee with output of about 14,000 tonnes, including 1,200 hectares of early-ripening lychee with total yield of 13,200 tonnes, and 129 hectares of main crop with an estimated output of 800 tonnes.

The area of lychee meeting VietGAP standards and high requirement in food safety has expanded to 880 hectares, including 350 hectares meeting VietGAP standard, up 50 hectares compared to that in 2020 with output of 4,300 tonnes, while the area of orchards meeting GlobalGAP standards is 5 hectares with production of 63 tonnes.

For the Chinese market, Tan Yen has maintained the area already granted area code for export in Phuc Hoa commune with 600 hectares and output of 6,500 tonnes. For the Japanese market, the district has coordinated with the Plant Production Department under the provincial Department of Agriculture and Rural Development to designate farming areas and ask the Japanese side to grant cultivation area codes to five hectares of orchards of 11 local farmer households in Quat Du 2 village, and 10 hectares of 8 farming households in Phuc Le village. The total acreage of lychee production area for the Japanese market is 15 hectares with estimate output of 120 tonnes.

Lychees from the remaining areas of Tan Trung, Hop Duc, Lien Son communes and Cao Huong township with output of about 6,700 tonnes will be sold in domestic markets through cooperatives and selling locations across the district.

In order to ensure the quality of lychee, especially “thieu” lychee for export, Tan Yen has organised training courses to guide farmer in farming technique and writing farming diary. So far, 100 percent of local households have practiced the technique and written down the process.

The district has chosen IQC company as the consultancy agency during the process of applying for certification of the product’s quality.

The company has collaborated with professional agencies of Tan Yen, the People’s Committee of Phuc Hoa commune, and 11 households in Quat Du 2 village to apply new farming procedures and diary writing in line with regulations to lay the foundation for applying for GlobalGAP certification./.

Vietnam imports 15,600 CBU cars during May

Vietnam imported a total of 15,600 completely built unit (CBU) cars in May from three major regional markets of Thailand, Indonesia and China, making up 94% of the total number of vehicles imported into the country.

Data from to the General Department of Vietnam Customs show it imported 7,407 cars from Thailand, 4,470 from Indonesia, and 2,790 from China.

May saw the number of CBU cars of all types which had registered for import customs declarations increase by 4.8%, equivalent to a rise of 714 units compared to the imported volume from the previous month.

According to the General Department of Vietnam Customs, the number of imported CBU cars of all kinds during the five-month period increased by 78% to 65,736 units. Of the figure, the number of nine-seater cars imported from the Thai market rose by 53.3% to 43,630, while the number of transport cars surged by 124% to 15,355.

Meanwhile, May alone saw local firms spend approximately US$480 million on importing auto parts and accessories, a rise of 6.2% against April. The main suppliers were the Republic of Korea, with turnover reaching US$125 million, China with US$98 million, Thailand with US$94 million, Japan with US$70 million, Indonesia with US$18.4 million, and India with US$15.3 million.

The import value of auto parts and accessories throughout the reviewed period also soared by 63.3% to US$2.16 billion, equivalent to a rise of US$835 million from the same period last year.

Flexible monetary policy helps recover credit growth amid pandemic

The State Bank of Vietnam (SBV) has flexibly operated monetary policy tools to maintain liquidity for the banking system, contributing to stabilising and recovering credit growth in the context of unpredictable impacts of the COVID-19 pandemic.

The information was announced by the SBV at a press conference on June 21 to review the banking sector’s activities in the first half of 2021.

According to SBV Deputy Governor Dao Minh Tu, thanks to synchronous management solutions, as of June 15, total credit in the economy expanded 5.1 percent from the end of 2020. The credit growth rate in the same period last year was only 2.26 percent

Attention has been paid to strictly controlling credit for areas with potentially high risks, and taking measures to remove difficulties facing enterprises and people in accessing bank credit, he said.

Total M2 payment vehicle – one of the tools to measure the level of “pumping money” into the economy from the banking system – in the period increased by 3.96 percent compared to the end of 2020 and surged 14.27 percent over the same period last year. The credit institution system maintains smooth liquidity.

The sector has continued to manage interest rates in line with the macro-economic balance, inflation, market movements and the objectives of the monetary policy, contributing to cutting capital costs for people, businesses and the national economy.

A series of measures have been implemented to support borrowers amidst the COVID-19 pandemic, helping them restructure cash flows, and revive production and business activities.

As of May 31, credit institutions have rescheduled debt repayments for 257,602 borrowers with total outstanding loans of over 336.6 trillion VND (14.61 billion USD), exempted or reduced interests for 676,690 customers with total outstanding loans of over 1.2 quadrillion VND, provided new loans with low interest rates totaling over 3.5 quadrillion VND for nearly 481,000 borrowers.

Regarding the form of payment and transaction, Director of the SBV’s Payment Department Pham Tien Dung said non-cash payment activities have been expanded in the last six months.

Payment transactions via Internet channels surged by 65.9 percent in volume and 31.2 percent in value, while payment transactions via smart phone jumped by 86.3 percent in volume, and 123.1 percent in value.

Payments via QR Code increased by 95.7 percent in volume, and 181.5 percent in value, Dung added.

The SBV said it will continue to keep close watch on the macro-economic and monetary situation, as well as local and global developments of the pandemic, thus giving appropriate orientations in credit management and structure, towards promoting sustainable economic growth and development.

Notably, the banking sector will tighten control of credit in potentially risky areas such as real estate, build-operation-transfer (BOT) and build- transfer (BT) projects, and securities, Tu said.

He asked credit institutions to intensify management of credit quality, and implementing measures to curb bad debts./.

HCM City requires over US$42 billion for transport infrastructure upgrades

The HCM City People’s Committee has issued a plan to implement the city’s transport infrastructure upgrade project in the 2021-2030 period, which will require investment of VND970.6 trillion (US$42.3 billion).

About VND399.7 trillion will be funded by the State budget and  the remaining nearly VND571 trillion will come from other capital sources.

Under the plan, in the 2021-2030 period, the city will invest in over 650km of roads, 211km of railroads, 81 big bridges, 15 major intersections, and seven projects under the Smart Cities programme. It will also complete highways and national routes connecting the city with the Key Southern Economic Zone.

During the 2021-2025 period, the city will prioritise key and urgent projects with total investment capital of over VND553 trillion, of which the State budget will provide VND181 trillion and other capital sources VND372 trillion.

The key and urgent projects for the 2021-2025 period include the HCM City-Moc Bai Highway, Ring Roads No 2 and 3, National Highways No 1, No 22, No 50, and No 13, several elevated roads, main intersections and bridges in high-density urban areas.

A number of key and urgent infrastructure works will be completed by the end of this year, mostly in Thu Duc city.

The city has set a target of raising the ratio of traffic land to urban land to 12.76% in 2021, and the average density of roads out of the city’s land area reaching 2.26 km per sq km.

The HCM City People’s Committee has requested that sectors and localities develop specific programmes, plans, and projects on infrastructure development as part of their annual and five-year socio-economic development plans in the periods from 2021-2025 and 2026-2030 to ensure the effective implementation of the transport infrastructure upgrade project.

Employees adapt to more ‘agile workplaces’ amid pandemic

Amid the COVID-19 crisis, employers want to keep their staff safe while coping with challenges to maintain normal and effective operations, said human resources experts and business leaders at a recent meeting.

To meet both business and individual concerns, most businesses and organisations have gradually shifted towards agile working environments, experts said at a recent virtual event co-organised by the global workforce solutions company ManpowerGroup and the American Chamber of Commerce (AmCham).

“Agile working refers to individual and organisational practices that leverage technology and flexibility to enable employees and their organisations to better collaborate across departments, locations and working environments,” said Nguyễn Thanh Hương, country HR manager at ManpowerGroup Vietnam.

“This model should become a part of our everyday work culture with the goal of achieving an optimal balance between agility, productivity, performance, information security, compliance, client satisfaction, well-being, and much more.”

According to the Skills Revolution Reboot survey of 26,130 employers in 43 countries by the ManpowerGroup, three out of four employers require at least 50 per cent of their staff to work in the workplace all or most of the time, based on their individual roles. Yet most are also working to build new kinds of flexibility into roles traditionally seen as inflexible.

Trần Thị Thu Thắm, head of Human Resources at Bosch Vietnam, said: “Agile working requires managers and employees alike to develop an even stronger culture of mutual trust and responsibility.”

To keep their jobs, local workers need to know how to adapt to their working model to remain an integral and valuable part of their organisation.

Thái Vân Linh, CEO & Founder of TVL Group, cited her practical experience in applying this model. “Agile working means how to work efficiently, to balance tight deadlines, give attention to detail, achieve target results, and balance work and personal life.”

The “What Vietnamese Workers Want in the New Normal” survey conducted by ManpowerGroup Vietnam in November and December 2020 surveyed 463 participants who said that COVID-19 should be a catalyst for a new future of work, which is flexible, diverse and oriented toward wellbeing.

Vietnamese workers are united in what they want to prioritise for the future, including staying healthy, learning and developing new skill sets, keeping their job, and bringing more balance between work and life.

As for the benefits of being in the official workplace, the respondents said they highly valued opportunities for collaboration, productivity and efficiency improvement, and appreciated the office as a way of separating work from home.

However, a proportion of respondents preferred flexibility in terms of location and schedule, or working remotely full-time.

Nearly 78 per cent of respondents placed significance on learning and career coaching.

Amid current uncertainties, employability matters to workers and 72 per cent said that simply keeping their job was the most important priority. 

Work security and well-being have been identified as the most crucial factors that both Vietnamese workers in general and working parents in particular would like to focus in the “new normal”. 

Thừa Thiên-Huế Province aims to build a lotus brand

The central province of Thừa Thiên-Huế has applied several measures to preserve and sustainably develop Huế’s traditional lotus farming.

The People’s Committee of Thừa Thiên-Huế Province has worked with the Việt Nam Academy of Agriculture, the University of Agriculture and Forestry under Huế University and research centres to research, conserve and develop Huế’s lotus gene resources through tissue culture method.

The efforts aim to sustainably develop lotus cultivation and increase economic efficiency and income for people growing lotus in the province.

The province has focused on high-quality and productive lotus varieties and provided lotus farmers with training courses on seed care, land improvement and production in accordance with VietGAP standards.

In addition, the province has helped connect lotus growers with traders to ensure their products are consumed by supermarkets, tourist attractions and more in a bid to build a ‘Huế Lotus Seed’ trademark.

The provincial People’s Committee is aiming that by 2025, the province will expand the new lotus planting area from 650ha to 745ha, with high-yield lotus for seed accounting for 85-90 per cent of the area and Huế purebred varieties 10-15 per cent of the area.

The average yield is estimated to be from 1,800-2,000kg of seed per hectare equivalent to an output of 1,200-1,400 tonnes of seed every year by 2025.

In recent years, provincial farmers have converted inefficient rice-growing land and abandoned lowland land to lotus cultivation, bringing high economic efficiency.

In Phong Điền District, the lotus growing area has expanded to about 355ha, concentrated in the communes of Phong Hiền, Phong An, Phong Hoà and Phong Chương and Phong Điền Township.

Trương Duy Hoà’s family in Phong Điền Township is one example of successful lotus farming.

Hoà’s family converted their 3ha of rice farming land to lotus farming more than 10 years ago and the new plant has brought his family a stable income.

After grasping the needs of the market this year, his family sowed earlier than usual.

So while many households were still planting, his family was harvesting and selling lotus seed for more than a month.

On average, he sold more than 200kg of lotus seed daily. At the beginning of the season, lotus seed costed VNĐ80,000 (US$3.5) per kilo, double the normal price. After deducting investment costs, the average income from lotus seed was about VNĐ120 million (US$5,200) per hectare, 4-5 times higher than from growing rice.

In Quảng An Commune, Trần Hũu Đạo’s family made a success of converting to lotus cultivation in  2018, on an area of ​​more than 1ha of low-lying land that was inefficient for rice cultivation.

According to Đạo, they plant lotus from February and harvest from June to August.

It was not yet time to harvest the main crop, but thanks to good weather conditions, this year’s yield was estimated at about 4 tonnes per hectare, said Đạo.

“The advantages of lotus are it is easy to grow and adapts to low-lying and waterlogged areas, requiring little investment and care but stable yield and easy-to-sell products, so profits are high,” said Đạo.

“With the current price of fresh lotus seed at VNĐ40,000 (US$1.8) per kilo, my family would profit more than VNĐ100 million (US$4,400) in this year’s lotus crop,” he said.

In Quảng Điền District, the area cultivating lotus is about 60ha with more than 200 farmer households participating, mainly in Sịa Town and the communes of  Quảng Vinh, Quảng Lợi and Quảng An.

This year, thanks to the amount of alluvium deposited after the floods, the lotus plants in this area grew evenly and had good quality seed.

Lê Văn Thiên, vice president of Farmers’ Association of Quảng Điền District, said this year’s lotus crop was good and well priced.

“It is estimated that fresh unpeeled lotus seed costs VNĐ40,000 per kilo and finished lotus products cost VNĐ75,000-80,000 per kilo,” said Thiên.

“Lotus cultivation has not only improved the lives of households but also created jobs for many local workers,” Thiên said.

The association plans to keep working with local authorities and other sectors to encourage people to take advantage of the abandoned water surface, low-lying areas and inefficient soil to grow lotus in combination with fish farming to increase income, according to the vice president.

The association will also promote the establishment of co-operative groups and professional associations to stabilise the output for lotus products as well as mobilise people to develop Huế’s lotus varieties to build a brand. 

Vietnam’s exports to EU surge amidst COVID-19

Trade in goods between Vietnam and the European Union (EU) has seen positive growth since the beginning of 2021, despite the impact of the COVID-19 pandemic.

According to statistics of the General Department of Customs, Vietnam exported 16.1 billion USD worth of goods to the EU during January-May, while importing commodities worth 6.7 billion USD from the bloc, up 20.1 percent and 16.8 percent compared to the same period last year, respectively.

The EU is currently Vietnam’s fifth largest trade partner and second biggest importer of Vietnamese goods, following the US. Last year, two-way trade reached 49.8 billion USD, down 0.1 percent year-on-year, and accounting for 9.13 percent of Vietnam’s total foreign trade.

With the EU-Vietnam Free Trade Agreement, Vietnam’s export to the bloc has bounced back since the end of 2020, said Tran Thanh Hai, deputy head of the Ministry of Industry and Trade’s Import-Export Department.

Thanks to the preferential tariffs under the deal, footwear exports to the bloc’s 27 member countries increased by 19.2 percent year-on-year in the first quarter of 2021.

Countries that saw surges included Spain (39.2 percent), Belgium (37 percent), Czech Republic (36.5 percent) and Sweden (30.8 percent).

The agreement is also creating favourable conditions for the export of Vietnamese farm produce.

In recent days, batches of fresh lychees have been shipped to the Czech Republic, Germany, France and Belgium.

Tran Van Cong, Vietnam’s agricultural counsellor in Europe, said that the first batch of lychee to Belgium marked an important milestone as a special “passport” proving the production capacity of the Vietnamese agricultural sector.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), European importers have shown more interest in Vietnamese seafood suppliers given tariff advantages from the EVFTA and the stable source of raw materials. Vietnam’s seafood exports to the EU reached over 380 million USD in the first 5 months of this year, up 15 percent y-o-y, with half of which, nearly 199 million USD, coming from shrimp, up 22 percent y-o-y./.

Long An: Four new industrial clusters to be put into operation this year

The southern province of Long An is set to get four industrial clusters this year, Vinh Khang, Tan My, Tu Phuong and Hiep Hoa, according to the provincial Department of Industry and Trade.

Their developers are expected to clear the lands by the end of this month and then begin construction of infrastructure for wastewater treatment, traffic, water, drainage, and electricity, which are expected to be completed by the end of this year.

Once completed, they will add nearly 200 hectares to the province’s availability of industrial lands.

The province has 16 industrial parks with a total area of over 2,282ha and average occupancy of 89.2 percent.

They house 796 foreign projects worth a total of 7.857 billion USD and 831 local ones worth 92.32 trillion VND (4.02 billion USD).

It is also home to 22 industrial clusters with an occupancy rate of 86.5 per cent. There are 647 projects with a total investment of 16.128 trillion VND (701.2 million USD), including 60 foreign ones worth 209.6 million USD.

According to its Department of Industry and Trade, the province’s industrial cluster development plan for until 2020 envisaged having 62 industrial clusters with a total area of more than 3,100ha by then, but currently only 22 industrial clusters have been put into operation.

The department said it would focus on completing the province’s industrial cluster development plan for 2021 – 30 to attract more investment.

Besides, it would monitor and ensure developers of infrastructure in the clusters finish the work in time, it added./.

High trade deficit recorded over five months nothing to worry about

Vietnam’s export industries posting a trade deficit over the opening five months of the year is not a worrying sign as most imported items are raw materials necessary for production, especially for the group of export goods, according to industry insiders.

Over the past five months local businesses have accelerated their import of electronic components, raw materials and accessories for leather and footwear, textiles, electronics, machinery, tools and spare parts, phones and accessories, plastics, and farm produce as a means of boosting production activities.

May alone saw Vietnam record a trade deficit of more than US$2 billion, thereby making the trade balance during the reviewed period reverse after a long period of securing a trade surplus. Meanwhile, the import turnover of goods surged by 36.4% to US$131.31 billion compared to the same period from last year.

Most notably, the sharp increase in imported goods mainly came from foreign-invested businesses, with turnover reaching US$85.5 billion, an increase of 39.9% compared to last year’s corresponding period.

Vu Duc Giang, chairman of the Vietnam Textile and Apparel Association (VITAS), attributed the recent rise in imported raw materials and accessories to the recovery of the garment and textile industry. Indeed, export turnover increased by up to 15% throughout the reviewed period.

In addition, the increase in import of production materials, especially electronics, high-tech items, and machinery and equipment is anticipated to create greater opportunities for businesses to boost their exports in the near future.

Dang Hoang Giang, general secretary of the Vietnam Cashew Association (VINACAS), said that the import of raw cashew nuts also skyrocketed during the five-month period. The total imported volume of raw cashew from Cambodia soared by more than 500% in value whilst also exceeding last year’s import volume.

Vinh Long seeks investment in major projects across the board

The Cuu Long (Mekong) Delta province of Vinh Long is soliciting investment in large projects that use modern and environment-friendly technologies and bring high added value.

It is calling for investment of over VND24.37 trillion (US$1.06 billion) in 10 projects in all three main sectors of the economy.

Le Minh Tan, director of its investment promotion and enterprise support centre, said the province is inviting investment in key projects, including the VND2.9 trillion ($126.1 million) Binh Tan Industrial Zone (IZ) in Tan Quoi Town with an area of 400ha.

In the agricultural sector, it is soliciting investment of around VND250 billion ($10.87 million) in a 50-100ha high-tech agricultural project in Vinh Long City.

It is also promoting an agricultural production and processing project in Binh Minh Town on an area of 10.6ha and costing VND400 billion ($17.4 million).

In the housing sector, the province is looking for investment of VND8.05 trillion ($350 million) in the 500ha My Hoa new urban project in Binh Minh and My Hoa communes and Binh Minh Town.

There is also an urban and administrative project worth VND7.5 trillion ($326.1 million).

The province is mobilising resources to promote tourism with the aim of turning it into a key economic sector by 2030.

Its tourist and tourism revenues are increasing by 11.6 per cent and 25.7 per cent a year on average.

The province has also begun to attract investment in supporting industries such as the production of automobile parts.

This conforms with its desire to foster industrial production.

To improve the quality and effectiveness of foreign investment, it is working to attract strategic investors from markets such as Japan, South Korea, Taiwan, Singapore, and the EU, Tan said.

South Korea now has 18 investment projects worth nearly $90 million in the province, while Japan and Taiwan have invested $102.5 million and $239.2 million respectively.

The province also targets major projects and those with high-added value and using advanced and environment-friendly technologies, especially in agri-industry, human resources training and agricultural-based tourism, he said.

Local authorities would create optimal conditions for investors to know about key projects and incentives, and help them resolve investment obstacles, he added.

They have been announcing support and incentives to encourage investment in tourism, building infrastructure, tweaking planning for tourist areas to attract more investments, and developing unique tourism products.

Vinh Long last year issued investment certificates for 26 projects with a total investment of VND4.35 trillion and over $104 million, including six foreign-invested ones. 

Fertiliser prices continue to increase: MoIT

Fertiliser prices are forecast to continue to grow for the rest of the year, caused by a number of factors including higher shipping costs, a representative of the Chemical Department said.

Speaking at the Ministry of Industry and Trade (MoIT)’s monthly press conference held on Thursday, Luu Hoang Ngoc, deputy director of the MoIT’s Chemical Department said: “The fertiliser price fluctuation in 2021 is similar to that in 2008, and the prices will continue to increase from now until the end of the year.”

The main factor pushing up prices is higher cost to hire shipping containers, while imported fertilisers, such as diammonium phosphate (DAP), mono-ammonium phosphate (MAP) and urea, are mainly transported on containers.

Currently, the cost to hire shipping containers has increased five times compared to the previous year.

In addition, fertiliser supply in Southeast Asia has declined as many factories have entered the period of maintenance.

The price of raw materials has increased on the world market so the price of domestically-made fertiliser products has also soared, according to the Chemical Department.

At present, the Ministry of Agriculture and Rural Development (MARD) manages production, trading, and import-export of none organic and organic fertilisers.

However, “the MoIT manages import-export activities and the domestic market, working closely with MARD to ensure supply,” Ngoc said.

According to Le Trieu Dung, director of the MoIT’s Trade Remedies Department, the strong increase in prices started early 2021. The reason has been mainly due to the increase in cost of material for production of DAP and MAP fertilisers, of which the price surged by two times for sulfur and 30 per cent for ammonia.

However, after assessing supply and demand, the MARD and MoIT have found that there is enough fertiliser supply for domestic use.

“The supply of fertilisers, especially DAP fertilisers, is still enough for the domestic needs,” Dung said.

“Specifically, the import of DAP and MAP fertilisers from the beginning of the year to now increased by 50 per cent, while the domestic production also increased by about 30 per cent.”

In addition, the prices of domestically-produced DAP and MAP fertilisers are between VND8-10 million per tonne, lower than the price of imported fertiliser at VND14-15 million per tonne. This is also a factor helping to stabilise the domestic market.

Over the past month, the MoIT has taken safeguard measures for imported DAP and MAP fertilisers to protect domestic production. After an investigation on import fertiliser, the ministry has issued a decision to impose taxes on those products from 2017, according to Dung.

In the future, the MoIT will continue to coordinate with the MARD to monitor the fertiliser market and have measures to stabilise the market. 

Hundreds of planes left idle at Noi Bai, Tan Son Nhat airports

Hundreds of planes are now left unused at Vietnam’s two biggest airports of Noi Bai and Tan Son Nhat.

At present, airlines in Vietnam own 230 planes, up 24 against 2019. Despite having more planes, the airlines have seen a sharp fall in flight number due to the Covid-19 pandemic.

Since May 1 as the fourth Covid-19 wave hit Vietnam, flights to Noi Bai International Airport have considerably dropped from the peak time of up to 530 flights with a total of 78,000 passengers daily on the occasion of Reunification Day Holiday (April 30).  

Currently, the airport serves around 120 flights, including cargo flights, with around 5,000 passengers per day.

The Hanoi-HCM City air route which was considered as the world’s second-busiest in November last year just behind South Korea’s Jeju-Seoul, now only has 18 daily flights compared to 130 previously.

Overnight parking demand for planes at Noi Bai and Tan Son Nhat airports has drastically increased. So, the Civil Aviation Authority of Vietnam has asked to use closed runways for parking.

According to the Vietnam Aviation Business Association, local airlines would witness a total loss of VND15 trillion.

The Ministry of Planning and Investment recently announced Vietnam Airlines losses in the first half of this year of VND10 trillion. The carrier’s overdue debt is VND6.24 trillion.

The Ministry of Planning and Investment forecasted that the aviation sector would continue facing difficulties this year due to Covid-19. If the pandemic is brought under control this year, the sector’s operations would stabilise by 2024.

Policy support needed to boost business growth: insiders

Without a more effective business support package, the country’s goal of 6.5 percent in gross domestic product (GDP) growth for this year will be hard to be achieved as the GDP growth in the first six months of 2021 is forecast to reach only 5.8 percent, according to experts.

Nguyen Xuan Phu, Chairman of Sunhouse Group, said that like many other large-scale firms, Sunhouse hopes to receive support in policy rather than financial assistance.

The country currently has about 500 large-scale enterprises that contribute 60-70 percent to the State budget, making it impossible to provide a common support package for all of them, noted Phu, stressing that support in policy will be much more effective.

Businesses need a smoother mechanism and simplier administrative procedures so that they can focus on production, as COVID-19 has created development opportunities for many firms, said Phu. 

Meanwhile, Than Duc Viet, General Director of May 10, another big-sized enterprise, said that the current support package has yet to be able to help businesses overcome difficulties although many areas are eying opportunities to rise due to recovering demand in the world market.

Viet said that in 2020, May 10 and other firms in the garment-textile sector faced difficulties in both input and sale, in 2021, the situation has changed completely with abundant orders.

About 90 percent of the company’s products are exported to the US, the EU and Japan with orders enough for production until the end of this year, but without favourable mechanisms and policies to help businesses to attract labourers and protect them against COVID-19, the firms can hardly complete their orders.

Although the number of COVID-19 cases has exceeded 12,500, Vietnam has still been considered one of the most successful countries in the world in pandemic control.

Nguyen Duc Kien, head of the Prime Minister’s economic advisory team, said that Vietnamese firms are eying great opportunities to win the world market when other large suppliers such as India, Bangladesh and Myanmar are struggling with the pandemic.

The current fiscal, monetary and social security support has been no longer suitable to large-scale firms, he held, adding that it is necessary to design another support package – support in policy.

Kien added that the current time is also a great chance for Vietnam to increase foreign direct investment (FDI) attraction. Along with the effective control of the pandemic, it is crucial to design new and stronger support policies to promote economic growth and complete the target of at least 6.5 percent GDP growth this year and following years, stressed Kien.

Deputy Minister of Planning and Investment Tran Quoc Phuong said that the pandemic has changed the mindset of many big and strategic investors on the formation of a production hub to diversify supply chains and distributing the supply chains in the globe, including in Vietnam.

According to Phuong, the support package for FDI companies cannot be the same as those for small and medium-sized enterprises, but it is necessary to give breakthrough policies and mechanisms.

“We should not organise traditional roadshows or trade promotion events in other countries. So how we can persuade investors to pour a large amount of capital into Vietnam without having to visit the country? To do so, we must give another support package with assistance in policy and mechanism,” stated Phuong./.

Farmers utilise e-commerce to boost sale of agricultural products

Agricultural specialties of some provinces are being sold on the e-commerce platform Sendo, marking the first time cooperatives and farmers have directly put their produce on sale in the digital environment.

The programme, co-organised by Sendo and the Vietnam E-Commerce and Digital Economy Agency (IDEA) under the Ministry of Industry and Trade (MoIT), enables cooperatives and farmers in the provinces of Bac Giang, Hai Duong, Vinh Long, Dak Lak, and Son La to directly sell their products to consumers, without intermediaries, thus ensuring competitive prices and freshness.

The produce on sale are all in season such as plums of Son La, avocadoes of Dak Lak, lychees of Bac Giang and Hai Duong, and purple sweet potatoes of Vinh Long.

Joining in this programme from June 21 to 26, farmers will receive the Sendo staff’s guidance on how to package and introduce their products via livestreaming so that they can gradually use e-commerce as a long-term distribution channel.

Bui Huy Hoang, an IDEA official, said the agency is working with e-commerce platforms, including Sendo, to help boost the sale of Vietnam’s agricultural products, and the efforts will benefit more produce from across the country in the time ahead.

The MoIT will also keep coordinating with relevant ministries and sectors to organise other programmes supporting the sale and brand building for agricultural products, including those providing e-commerce training./.

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

Source: https://vietnamnet.vn/en/business/vietnam-business-news-june-22-747769.html

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Analysts praise VIB’s business strategies at meeting for Q2 business results

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Three VIB representatives joined the online event. — Photo courtesy of the bank

HÀ NỘI — The Vietnam International Bank (VIB) organised an online meeting with the participation of more than 180 representatives from large funds, securities companies, independent analysts and the press.

The online meeting discussed three main topics, including VIB’s strong business results in the first half of 2021, key business strategies that have helped VIB become the top retail bank in Việt Nam and digital banking – the future of retail business.

During the event, VIB representatives reported on the bank’s business results in the first half of 2021 while sharing the strategy of maintaining high and sustainable growth momentum that the bank has ensured for many years and its support for customers and the community amid complicated developments of the COVID-19 pandemic.

Since the pandemic hit Việt Nam, VIB has offered many reductions in lending interest rates for corporate and individual customers to help them overcome this difficult time.

The bank has restructured debt for more than 3,000 customers under the Circular 01 and 03 issued by the State Bank of Việt Nam, VIB Chief Financial Officer Hoàng Linh said at the event.

It has also slashed lending rates by between 0.5 and 2 per cent for nearly 10,000 clients affected by the pandemic, he said. 

Recently, VIB continued to reduce lending interest rates for individual and corporate customers with an average interest rate reduction of 1.5 per cent from July 15, focusing on customers severely impacted by the pandemic, Linh added.

Thanks to VIB’s timely and effective assistance, the outstanding balance of the restructured loans was paid in full and on time by most customers, helping the bank’s total loan balance decrease.

NIM expansion

Meanwhile, VIB has also continued to expand its Net Interest Margin (NIM) by promoting the development of the retail segment and optimising funding costs.

A report from the bank showed that the NIM trend in the last six quarters had improved significantly due to the reduction in Cost of fund (COF). VIB’s COF decreased from 5.4 per cent in the first quarter (Q1) of 2020 to 3.8 per cent in the second quarter (Q2) of 2021. Meanwhile, NIM increased from 3.9 per cent in Q1/2020 to 4.6 per cent in Q2/2021.

Linh said the bank has actively optimised the funding cost by promoting the growth of Current Account Savings account (CASA) while increasing low-cost funding sources on the international market.

Charts show VIB’s strong NII with sustainable and improving NIM. —  Photo courtesy of the bank

Recently, the bank signed a syndicated loan worth US$260 million over three years with the Asian Development Bank (ADB) and a number of international financial institutions.

“VIB is also implementing a plan to digitise all CASA and deposit products to further grow this capital source,” Linh said. 

As of June 30, VIB’s total assets reached over VNĐ277 trillion; its credit balance was over VNĐ185 trillion, 8.1 per cent higher than the beginning of the year, while deposits from customers increased over 12 per cent year-on-year.

VIB’s NPL ratio decreased to 1.3 per cent. With strict risk management, the bank has maintained its risk indicators and prudential ratio. Capital adequacy ratio (CAR) according to Basel II was recorded at 10.3 per cent, the loan-to-deposit ratio stood at 73.1 per cent.

Effective retail business strategy

With its effective retail business strategy, VIB’s outstanding retail balance experienced positive growth at 14.2 per cent in the first six months of this year, accounting for nearly 90 per cent of total outstanding credit balance amid the pandemic.

The retail portfolio has also helped VIB reduce concentration risks and better adapt in the current volatile market environment. It is also one of the banks that has the highest retail credit portfolio in the country. 

In her speech at the event, Trần Thu Hương, Head of Strategy and Head of Retail Banking, outlined mortgage loans such as real estate, automobiles, credit cards, and insurance as VIB’s market-leading business segments. 

After five years of transformation, VIB was among the Top 4 joint-stock commercial banks in terms of retail loan balance by the end of 2020 and this position may change in 2021, Hương said, adding that the retail segment accounted for 70 per cent of the bank’s pre-tax profit in 2020, from 21 per cent in 2016.

“VIB’s business strategies prioritise gradually receiving positive results from the automation and digitisation of sales and after-sales service in the retail segment,” Hương said. 

Also at the event, analysts questioned that as the leading bank in terms of auto loan market share for five consecutive years, whether VIB had difficulties in bad debt management and debt recovery, especially in the context of social distancing and the impact of the pandemic.

Hương said: “VIB is not only the leading bank in terms of sales but also the industry leader in risk management of the auto lending segment. VIB applies a strict risk appetite right from the product development stage and the customer’s debt repayment requirements, the loan to value (LTV) ratio is always below 80 per cent, closely evaluates collateral, and at the same time with selective lending: 90 per cent of auto loans are new car loans for consumers, concentrating on the top car brands in the market.”

“Thus, with a tight risk appetite from the upstream, after 18 months since COVID-19 pandemic started, the bad debt ratio of the retail segment in general and the auto segment in particular at VIB has almost remained unchanged,” Hương said. 

Talking about VIB’s outstanding areas of bancassurance and credit cards, Hương said VIB is currently ranked in the Top 1 and Top 2 for many consecutive years in the bancassurance business. Despite social distancing, VIB has maintained its top bancassurance sales in recent years, thanks to digital sales platforms and digital solutions that have been implemented by VIB in the last two years.

“The cake is huge for everyone to join in and do a good job. Việt Nam’s bancassurance premium to GDP ratio is less than 1 per cent, compared with an average of about 10 per cent of other countries in the region.”

Regarding the credit card business, Hương said the bank’s credit card opening and card spending rates reached the highest-ever level in the bank’s history as VIB is a pioneer in applying modern technologies to daily life. From the opening stage to usage, it is completely online, besides others outstanding features that VIB applies in Việt Nam.

After more than two years of strong implementation of the credit card business, the bank has successfully applied artificial intelligence (AI) and big data processing (Big Data), along with modern technologies such as e-KYC and e-Signature in the credit card approval process, setting a new record for processing and approval period until the card is used: only 15-30 minutes, equal to 1/500 of the average time in the market. As a result, VIB continues to be in the top position in terms of growth in the number of credit cards and spending on cards, ranked second in the whole market, according to a report by the Vietnam Card Association.

 “This confirms that our credit card development strategy is promoting our strengths in technology, unique product features, and the outstanding customer experience in the market,” Hương said.

Answering questions from some fund representatives on whether VIB would consider expanding its customer base through developing strategic partnerships with other companies, Hương said that VIB focuses on developing digital banking, with digital solutions to be able to reach a diverse set of customers instead of targeting a few specific customer groups.

In her speech, VIB’s representative also expressed optimism and confidence in the policies of the State Bank of Việt Nam and the Government in both protecting the community against the pandemic and facilitating economic activities. 

A VIB logo is seen at the bank’s head office in HCM City’s District 1. —  Photo courtesy of the bank

Pioneering in digital banking 

VIB has the leading technology platform in the market. The bank has pioneered the application of technologies such as Big Data, AI, and cloud computing in transactions to make the online payment experience of customers easier and more convenient.

Trần Nhất Minh, Deputy Chief Executive Officer and Chief Digital Officer, said VIB’s digital banking experienced an impressive registration growth of 130 per cent in 2020. Customers can easily open cards for payment, account opening, online savings, money transfer, and other banking services at home instead of going to a branch. 

VIB has also offered many 100 per cent digital products while cooperating with partners such as Ho Chi Minh City Securities Co (HSC) and VNDirect securities company to better support customers.

“The bank’s CASA ratio is currently at 13 per cent and there is much room for growth in the future, helping to maximise capital expenditure and expand NIM. These factors help VIB become one of the top banks in terms of online transactions which account for 91  of the total number of transactions,” Minh said. 

In the future, VIB representatives said the bank will continue the outstanding achievements of the 10-year transformation programme to maintain its leading positions in retail and technology in particular and at the same time exceed its challenging business goals in 2021. — 

Source: https://vietnamnews.vn/economy/1004260/analysts-praise-vibs-business-strategies-at-meeting-for-q2-business-results.html

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Businesses dig deep to make sure they come out on other side of pandemic intact

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A customer tries to book a quarantine hotel service on Traveloka app. Traveloka and many businesses in Việt Nam are making efforts to survive the forth wave of COVID-19 pandemic. — Photo

Thu Ngân

HCM CITY — Businesses in Việt Nam are making all efforts to survive the fourth wave of COVID-19 which is battering the country.

Giant food producer KIDO Group said in a recent press release it has adopted a number of solutions to adapt to the new situation and keep production going while also ensuring safety.

A spokesperson told Việt Nam News that to ensure uninterrupted production, the company has adopted the “3 on-site” model, which involves on-site production, dining and rest, for over a month.

It unfailingly complies with the provisions of the Government’s circular No 16 and 5K message, he said.

It is also preparing for life after the pandemic, he said.

“We are ready to bring new products and segments into the market immediately after COVID-19 is controlled.”

It plans to introduce the Vibev brand of products made in collaboration with Vinamilk.

Another plan is to introduce Chuk Chuk, a new food and beverage brand, opening 1,000 stores by 2025.

The company’s general director, Trần Lệ Nguyên, said the first market for Chuk Chuk would be HCM City, and stores would open in Hà Nội and some northern provinces by September if the pandemic is controlled by then, adding it would be present across the country by 2025.

Ride-hailing and delivery company Grab has rolled out a number of programmes to help customers buy foodstuffs.

To ensure the safety of its drivers and customers, it has tied up with the General Department of Vocational Education and Training to fully equip its drivers with the necessary skills and competencies.

They have also jointly built and standardised the training materials, and drawn up communication plans for raising awareness about vocational skills development for drivers.

Trương Anh Dũng, director general of the department, said: “The COVID-19 pandemic has had a great impact on the Vietnamese economy, and drivers cannot be immune to it. This partnership helps resolve long-term problems for technological drivers, equipping them with the necessary skills to sustain and improve not only their livelihoods but also the quality of life of themselves and their families.”

Grab also has a programme to support disadvantaged people in HCM City in co-operation with Golden Lotus Foundation. It provides free meals to people economically affected by the pandemic or living in locked-down areas.

To start with, around 11,500 meals would be provided, it said.

Tourism is one of the many sectors badly hit by the pandemic, and many businesses in it have been striving to overcome the challenges they face. 

For instance, before the semi-lockdown began weeks ago some hotels had begun to offer co-working space to provide customers with a safe working environment.

Now, with stricter social distancing regulations, they have changed their strategy and offer quarantine facilities, and this has received strong support from customers.

Recently a Southeast Asian travel and lifestyle superapp, Traveloka, announced that it is working with the HCM City Department of Tourism to help the city’s residents find and book hotels and transportation to enable quarantine. 

Demand for quarantine facilities has increased along with the developments of COVID-19 in HCM City, and its quarantine hotel and transportation online booking and payment solutions are expected to help curb the spread of the pandemic by limiting direct contact between people, Traveloka said. 

They have been available since the start of August. 

Lê Trương Hiền Hoà, director of the HCM City Tourism Promotion Centre, hailed the partnership, saying: “With support from Traveloka, HCM City is the first city in Việt Nam to digitise the quarantine hotel booking process … and will extend it to international arrivals in the near future. 

“It also helps hoteliers switch their business model to survive amidst the COVID-19 pandemic.”

With the aid of the app’s advanced technologies, customers can easily access complete information about room types, prices and transportation options in real-time, and pay for it via Traveloka. 

Traveloka said it is partnering with more than 80 hotels and selected transportation partners across HCM City, including private cars and shuttle buses. 

MVV Academy, a pioneer organisation for comprehensive, on-site and advanced resource development solutions in Việt Nam, decided to organise training programmes to make its staff sales consultants and brand ambassadors to introduce its products to the public. 

It also recently launched MVV Uni, an advanced training platform that offers working professionals an interactive and flexible experience to support their various learning needs, and acts as a one-stop-shop with courses in all essential business skill sets such as leadership, sales, marketing, management, soft skills, and digital transformation.

“The COVID epidemic has disrupted many human resource training activities at Vietnamese enterprises,” Bùi Đức Quân, CEO of MVV Academy told Việt Nam News.

“Taking advantage of the strength of technology, combined with experience in content building and understanding of learner experience through operating platforms such as TopClass and Everlearn, we quickly built a solution, MVV Uni, to offer enterprises training programmes for their employees during Covid.

“Our ambition is to build a university community on the cloud.” —

 

 

 

Source: https://vietnamnews.vn/economy/1003623/businesses-dig-deep-to-make-sure-they-come-out-on-other-side-of-pandemic-intact.html

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COVID-19 forces banks to accelerate digital transformation

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The COVID-19 pandemic not only creates challenges for banks, but also pushes them to foster digital transformation to survive, experts have said.

COVID-19 forces banks to accelerate digital transformation
A customer makes payment via a QR code. The COVID-19 pandemic pushes bank to foster digital transformation to survive. — Photo laodong.vn

A recent survey by the State Bank of Vietnam found that 95 per cent of credit institutions in Vietnam have either implemented digital transformation strategies or are in the process of formulating them.

It is expected that in the next three to five years digital-only banks will have revenue growth of at least 10 per cent, while regular lenders will have more than 60 per cent of customers using digital transaction channels.

State-owned banks seek to digitise their entire system, while smaller banks have identified certain areas to improve service quality and the customer experience.

Commenting on digital banking development in Vietnam at an online talkshow IDG TekTalk on Tuesday, Phan Viet Hai, director of information technology and also the digital banking centre at Viet Capital Bank, said digital banks must create a superior customer experience by changing the way services are provided using technology.

Nguyen Quang Minh, deputy CEO, partnerships, Timo Digital Bank, said, “In addition to offering perfect and up-to-date financial products and services, we also have to really understand the market, customers’ needs and expectations and more importantly, identify the problems and difficulties they are facing every day in each transaction.”

Pham Quang Minh, general director of Mambu Vietnam, said banking services have changed greatly in the past few years. In Asia, including Vietnam, rising customer expectations for online and mobile banking services are the driving force behind the digital transformation of financial service providers.

Nguyen Van Tuan, deputy general director of VCCorp & founder of Bizfly Digital Transformation, said currently banks are not only competing with each other but also with rapidly growing fintech companies, which have created “amazing” services and experiences through digital technology and transformation.

For succeeding at the digital transformation, the determination shown by a bank’s bosses plays an important role, he said.

“Technology contributes only around 30 per cent to the success with the remaining 70 per cent being owed to other factors like the mindset of businesses’ leaders and digital transformation,” he added.

According to experts, banks still face challenges in digital transformation related to regulations on electronic transactions, data sharing, network security, and an inadequate legal framework among others.

They said completing a comprehensive legal framework would provide a fillip to digital transformation.

The standardisation of technical infrastructure is also very important to facilitate interconnection and seamless integration between the banking industry and others to form a digital eco-system, they added.

Yeo Siang Tiong, cybersecurity company Kaspersky’s general manager for Southeast Asia, said: “Digital transformation, in any sector, always presents new challenges, but especially for banks and for financial services. To put it simply, revolutionising banks’ way of doing transactions means overhauling their legacy systems including people, processes and technologies.”

Humans remain the weakest link, especially those who lack proper awareness of the simplest risks like phishing and spam, while employees require new training and third-party services should be assessed comprehensively, he said.

“When it comes to security, the endpoint should be the foundation and banks should have known this by now. Financial services should be looking at an adaptive approach in security, which should be proactive rather than reactive – ready before an attack happens.” 

Online transaction increases

Due to social distancing restrictions amid the pandemic, online payment has become more convenient than cash, and, with just a smartphone and banking application, users can save, borrow money, pay for electricity, water, television, and internet bills, buy movie and airplane tickets, make hotel reservations, or even buy vegetables or meat online.

Pham Tien Dung, head of the State Bank of Vietnam’s payment department, said online transactions in the first four months of the year jumped by 66 per cent in terms of numbers and 31.2 per cent in value year-on-year, including 86.3 per cent and 123.1 per cent on mobile phones and 95.7 per cent and 181.5 per cent using QR codes.

Statistics from the National Payment Corporation of Vietnam, show that in the first five months its automatic clearing house processed over 800 million transactions worth over VND8 quadrillion ($347.7 billion), an increase of 113 per cent and 169 per cent.

A recent survey by Visa also revealed strong increases in the use of e-wallets, contactless payment via cards and smartphones and QR Code. The year-on-year growth rate of the total e-commerce transaction value in the first quarter of 2021 rose by 5.5 times compared to the fourth quarter of 2020.

Source: Vietnam News

Source: https://vietnamnet.vn/en/business/covid-19-forces-banks-to-accelerate-digital-transformation-763095.html

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