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VIETNAM BUSINESS NEWS NOVEMBER 16

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Foreign paper hails Vietnam as economic success story

Foreign paper hails Vietnam as economic success story hinh anh 1

The UK’s Daily Mail newspaper has published an article hailing Vietnam as one of the world’s economic success stories.

According to the paper, over the last three decades, the country has embraced the private sector, launched a stock market, benefited from large inward investment by large multinational corporations, and enjoyed 7-8 percent annual economic growth.

This success has led fund managers and some brave British investors to see Vietnam as an exciting investment opportunity. As a result, many Asian investment funds hold Vietnamese companies in their portfolios, and three specialist, high-risk trusts invest exclusively in listed and unlisted Vietnamese companies. Shares in these trusts are traded on the London Stock Exchange, the paper said.

The economy, like everything in the world, has been hampered by COVID-19 and blockades, but is back on track as restrictions have been lifted. This year’s growth is projected to be stable at 1.5 percent, but next year it is projected to return to pre-pandemic high growth, it said.

Its stock market has also risen by more than 30 percent this year, despite difficult economic conditions, showing the best performance across Asia. According to experts, the same may happen next year as Vietnam’s corporate profits recover significantly.

The country’s growing stock market is also expected to benefit from the reclassification of early “frontier” markets into full-fledged emerging markets next year. If this happens, it will attract the attention of large international investors and push up prices.

Investor Waverton is a big fan. Brook Tellwright, Thailand-based Waverton fund manager, said that Vietnam is now one of the most popular stock markets throughout Southeast Asia, alongside Indonesia and the Philippines. He states “However, we expect a strong economic recovery next year. This should improve corporate profits and help move the stock market forward”.

Emily Fletcher, co-manager of the investment trust Black Rock Frontiers, agreed. She said Vietnam’s “explosive” economic growth leading up to the pandemic has created great opportunities for Vietnamese companies. She believed this will continue as the country enjoys a “substantial economic acceleration” after COVID-19 restrictions are lifted./.

Shares start week on a positive note thanks to securities stocks

Shares had a good start on Monday thanks to the support of stocks in the securities sector, attracting large cash flow into the market.

The market benchmark VN-Index on the Hồ Chí Minh Stock Exchange (HoSE) gained 0.22 per cent to end at 1,476.57 points.

The index had gained 1.16 per cent last week.

The market’s liquidity was positive with 261 stocks rising, while 202 slid.

Investors poured over VNĐ34 trillion (US$1.5 billion) into the southern exchange, equivalent to a trading volume of VNĐ1.17 billion shares.

The 30 biggest stocks tracker VN30-Index gained 0.05 per cent, to end at 1,528.68 points. Fourteen in the VN30 basket climbed, while 16 decreased.

In the VN-30 basket, PVPower (POW) hit the daily limit rise of 7 per cent. HDBank (HDB) gained 3 per cent. Masan Group (MSN), SSI Securities Inc (SSI), Mobile World Group (MWG) and Vinhomes (VHM) all advanced more than 2 per cent. Tiên Phong Bank (TPB) rose by 1 per cent.

On the other side, Novaland (NVL) and The Việt Nam Rubber Group (GVR) were the ones that both lost more than 1 per cent. Many stocks also lost more than than 1 per cent, such as Hoà Phát Group (HPG), VPBank (VPB), Vietjet (VJC), Sabeco (SAB) and Techcombank (TCB).

The securities group attracted strong cash flow with many stocks reaching the ceiling prices, such as Asia – Pacific Securities Joint Stock Company (APS), Hoà Bình Securities JSC (HBS), Việt Nam Industrial & Commercial Securities Corporation (VIG), Wall Street Securities Company (WSS), BOS Securities Corporation (ART), Agribank Securities Corporation (AGR), Tân Việt Securities (TVS) and APG Securities JSC (APG).

Saigon-Hanoi Securities Co (SHS), Petrovietnam Securities Incorporated (PSI) and Guotai Junan Securities (Vietnam) Corp (IVS) all gained more than 7 per cent. VIX Securities Joint Stock Company (VIX) and Việt Dragon Securities Corporation (VDS) advanced more than 6 per cent. SSI Securities Inc gained 2.7 per cent.

In the group of agro-forestry-fishery, Hoang Anh Gia Lai Joint Stock Company (HAG) continued its steep gains and reached the highest price level in the past three years. Besides, Hoang Anh Gia Lai Agricultural JSC (HNG) advanced more than 4 per cent and Sao Mai Group Corporation (ASM) surpassed 5 per cent.

On the Hà Nội Stock Exchange (HNX), the HNX-Index gained 0.60 per cent to end Monday at 444.28 points.

During the trading session, nearly 204.5 million shares were traded on HNX, worth nearly VNĐ5 trillion. 

Is 6 – 6.5% GDP growth target for 2022 achievable?

The National Assembly (NA) has approved the Government’s proposal to raise the national GDP growth rate for 2022 to between 6% and 6.5%, with many NA deputies believing there is plenty of room for Vietnam to meet the target.

The target will come off the back of a challenging year for the country, particularly as the SARS-CoV-2 virus remerged in late April, exerting a severely negative impact on the national economy which suffered a 6.14% contraction during the third quarter of the year.

In a report addressed to the freshly-concluded NA session, Prime Minister Pham Minh Chinh admitted difficulties faced by the local economy due to the damage caused by COVID-19, and he then said the government had decided to lower the growth rate for this year to between 3% and 3.5%.

However, even the revised growth target set for this year will be difficult to achieve, according to deputy Le Thanh Van, as it requires the national economy to expand by 8.6% in the fourth quarter of the year given the fact that the COVID-19 outbreak is yet to be completely under control.

Meanwhile, a majority of deputies agreed that the 6% to 6.5% rate projected for 2022 must be obtained as a means of creating momentum for the following years.

“By 2030, we have set out to become a high middle income country with an annual average GDP growth rate likely to reach 6.5% to 7%,” said Huan.

Economist Dr. Tran Dinh Cung forecast that the GDP growth for this year may hover around 2%, far lower than the Government’s expectation. Therefore, the national economy must average annual growth of 7% from 2022 to 2025 in order to achieve the 6% – 6.5% growth target set for the whole period from 2021 to 2025.

“Even if the epidemic is well controlled, 2022 will also be a tough year if you look at the high target to be achieved. But I support the way the government has set the target, because this will bring to bear pressure and at the same time motivate us to realize the target,” Dr. Cung told Dau Tu (Investment) newspaper.

NA deputy Tran Hoang Ngan agreed that the prolonged COVID-19 outbreak has dealt a heavy blow to the domestic economy, although he remains optimistic that there are factors which will help the country to secure high growth over the coming years.

According to Ngan, Vietnam has maintained macroeconomic stability, whilst its major export markets such as the United States and Europe are recovering strongly. In addition, it has signed many bilateral and multilateral free trade agreements, of which 14 have already taken effect.

“If the COVID-19 outbreak is completely controlled, the 6 – 6.5% growth target will be achievable or the rate will be even higher,” said Ngan.

In order to secure the 6% to 6.5% growth rate for 2022, the economy is said to mobilise VND30 trillion worth of social investment capital, including nearly VND20 trillion from citizens.

Finance Minister Ho Duc Phoc stated that his Ministry is drafting an economic stimulus package worth VND20 trillion a year through interest rate support, in order to mobilise roughly VND1 quadrillion over five years for the economy.

“With VND1 quadrillion to be injected into the economy, we can then create jobs, boost the economy, increase budget revenue and reduce budget deficit,” stressed Minister Phoc.

Economic experts also expect the implementation of an economic stimulus package which is big enough for the next two years. Dr. Cung supported this view, outlining that the package will stimulate the economy, not just for social security.

“Many propose that the package should account for about 1 – 2% of GDP, but I expect a larger number for the period 2022 – 2023 and it may be extended to 2024,” said Dr. Cung.

The economist also suggested that existing bailout packages should be fully disbursed to the right businesses that have been hit hard by COVID-19 to help them gather full steam. According to the economist, total expenditure on existing bailout packages is rather small compared to the loss of businesses.

Playing field reset for power ventures after FiT deadline

Wind projects totalling nearly 4GW have achieved commercial operations in time for the feed-in tariff deadline, but concerns remain over other wind farms getting their developments off the ground altogether.

Some wind ventures that did not meet the FiT deadline may now be in a state of limbo, Photo: Shutterstock
According to state-run Electricity of Vietnam (EVN), 84 out of 146 wind power projects that had signed power purchase and sale contracts with EVN met commercial operation date (COD) on or before October 31.

It was deemed an impressive result after the rush to invest in wind energy to take advantage of the government’s pricing incentives before transitioning to a competitive bidding auction scheme. The wind feed-in tariff (FiT) was introduced by the prime minister’s Decision No.39/2018/QD-TTg and set at 8.5 US cents per kWh for all onshore wind power projects achieving COD before November 1 this year.

According to an estimate from the Global Wind Energy Council, which had initially called for extending the FiT deadline, 4GW of wind projects translate to around $6.7 billion in investment that would significantly benefit local authorities and communities. This includes $6.51 billion in capital expenditures and an additional $151 million in operating expenditures per year across an average 25-year lifetime of projects.

Meanwhile, the remaining 62 projects with a total capacity of 3,479MW could not become operational before the FiT expired.

According to Giles Cooper, a partner at international law firm Allens, various scenarios may now arise regarding wind power projects that have project financing arrangements.

“A project may fail to reach financial close if it doesn’t achieve COD in time to enjoy the current FiT. Alternatively, different conditions may apply depending on the terms of the project’s loan agreement – the amount of a loan can vary according to the level of FiT obtainable by the borrower. In the worst-case scenario, pending extension of the FiTs or issuance of regulations on auction, lenders may walk away from the transaction,” Cooper explained.

“If financial close has been achieved, failure to reach a scheduled COD as stipulated in the power purchase agreement (PPA) could constitute an event of default under the terms of the loan agreement, triggering early repayment obligations and/or enforcement of loan security,” he added.

One representative of an overseas investor in Vietnam told VIR, “Despite challenges with transportation and lack of foreign experts due to the pandemic, our project finally got COD on time – but operating below capacity will cause wind power investors like us to suffer losses.”

The representative explained that in the process of implementing the connection agreement, based on the progress of power grid projects of which EVN is the investor and under the direction of the Ministry of Industry and Trade (MoIT) on allowing a conditional connection agreement, the parties agreed to include a clause requiring investors to reduce or stop the plant capacity when there is an overload of the grid.

This requirement is added to the PPA with EVN, pushing some investors into uncertainty.

In an EVN report to the MoIT in September, it noted that “the total capacity of renewable energy power sources that have been and are expected to be put into operation by the end of 2021 is very large, affecting the operation of the power system and the situation of local grid overload in some areas. Therefore, EVN must reduce the capacity of power sources”.

The People’s Committee of the south-central province of Ninh Thuan has already sent a written request to the MoIT to consider directing relevant units not to cut capacity, prioritising the maximum exploitation of solar power project capacity to offset the production and business costs for investors.

Vietnam aims to double the installed wind and solar power generation capacity to 31-38GW by 2030, as reaffirmed last week by MoIT Minister Nguyen Hong Dien at a roundtable on the sidelines of the COP26 climate conference in Scotland.

Ministries to devise support plan for private kindergarten teachers

The Ministry of Education and Training will work closely with the Ministry of Labour, Invalids and Social Affairs to devise a plan to support COVID-19-affected teachers of private kindergartens and primary schools.

The co-operation was committed at a meeting between the two ministries and relevant agencies with Deputy Prime Minister Vũ Đức Đam on Monday.

The plan will be submitted to the Government for approval next week.

Representatives of sectors at the meeting emphasised the necessity of supporting private pre-school employees and businesses in order to share difficulties with them and reduce the number of teachers leaving jobs after the school’s reopening.

Some proposed offering assistance to teachers of private primary schools as well.

Supportive policies in terms of infrastructure, tax exemption and loans for private pre-school facilities will be taken into the national socio-economic recovery and development programme.

According to the Ministry of Education and Training, among educational levels, kindergarten has the highest number of private schools.

As of May this year (the end of 2020-21 academic year), there were 19,312 private kindergartens nationwide with more than 1.2 million children and over 90,500 employees.

As one of the hardest-hit sectors in the pandemic, private kindergartens have lost incomes over a long period due to school closures and no tuition, meanwhile, they still have to pay for land rental and a part of salaries for school staff.

A lot of non-public preschool educational institutions cannot afford wages for their employees, forcing teachers to change jobs.

According to a quick survey by the Việt Nam Association of Non-Public Early Childhood Education, 95.2 per cent of private preschool educational institutions have had no revenue for many months, mostly six months or more, and 81.6 per cent of the establishments are unable to pay salaries to teachers. 

Vietnamese, Bangladeshi firms promote ties

Meetings between Vietnamese and Bangladeshi firms were held in Dhaka, the capital city of Bangladesh and the port city of Chittagong on November 11 and November 7, respectively, to promote bilateral economic and trade ties.

Co-hosted by the Vietnamese Embassy in Bangladesh, the Bangladesh-Vietnam Chamber of Commerce and Industry, the Dhaka Chamber of Commerce and Industry and the Chittagong Chamber of Commerce and Industry, the events drew about ten Vietnamese enterprises operating in construction materials, farm produce, electrical appliances and transport services.

The Bangladeshi side announced the Government’s policy of inviting investment in 100 economic and processing zones nationwide with a number of incentives, with priority given to information technology, telecommunication, farm produce processing, aquaculture, apparel for export, and tourism infrastructure.

They said the country is reforming and simplifying administrative procedures to facilitate inward investment.

Participants highlighted a need to hold similar events to increase exchanges and soon launch direct flights between Vietnam and Bangladesh to facilitate travelling and business.

A majority of Bangladeshi enterprises expressed their interest in cooperating with Vietnam in the fields of apparel, agro-fisheries, processed food, construction materials, pharmaceuticals and chemicals.

According to the General Statistics Office, two-way trade between Vietnam and Bangladesh reached 981 million USD as of September 2021, of which over 90 percent were Vietnam’s exports to the South Asian country, up nearly 80 percent annually. The figure is expected to reach 1 billion USD this year./.

Vietnam banks restructure debts worth over US$24 billion during pandemic  

Banks have foregone around VND31.4 trillion ($1.38 billion) in profits by lowering lending rates from January 23, 2020, to late October 2021.

As of October, banks and credit institutions in Vietnam have restructured the debt payment schedules for over 500,000 customers affected by the pandemic with total outstanding loans of VND260 trillion ($11.5 billion).

This resulted in a total of VND550 trillion ($24.3 billion) since the Covid-19 pandemic first emerged in Vietnam in early 2020, the State Bank of Vietnam (SBV) revealed the figures reflecting efforts of the banking sector to address difficulties for the business community in accessing credit support for production resumption.

In addition, commercial banks under the instruction of the SBV have waived and lowered lending rates for nearly two million customers with total outstanding loans of VND3,790 trillion ($167.5 billion).

According to the central bank, banks have foregone around VND31.4 trillion ($1.38 billion) in profits by lowering lending rates from January 23, 2020, to late October 2021.

Over 1.2 million customers have also been able to access loans with preferential rates of over VND7,000 trillion ($309 billion).

The state-run Vietnam Bank for Social Policies (VBSP) alone has extended debt payment for around 260,000 customers for total loans of VND6.06 trillion ($267.5 million), along with new loans of VND130 trillion ($5.74 billion) for 3.5 million eligible customers.

While providing credit support for businesses, SBV Governor Nguyen Thi Hong warned Vietnam is facing high inflationary pressure next year, especially as countries around the world are pushing for economic recovery and prices of goods and products are rising.

Hong pointed out the fact that a number of major economies have seen record-high inflation such as the US, South Korea, or Europe in the last months, forcing central banks to ease monetary policies and raise inflation rates. 

“Vietnam, one of the most open economies in the world with its trade-to-GDP ratio at over 200%, is highly vulnerable to imported inflation,” she added.

For the domestic market, Hong expressed concern over the rising bad debts in the banking sector. “Banks have been lowering lending rates with their own resources, so they are on their own when dealing with bad debts,” she noted.

“The SBV is committed to further aiding the economy, but at the same time putting priorities on ensuring the national financial safety,” Hong suggested.

Trade fair of health care products for Vietnamese market held in RoK

A trade fair of anti-pandemic and health care products for Vietnamese market is underway via videoconference from November 15-19 in Gangnam district, the capital city of Seoul, the Republic of Korea (RoK).

Co-hosted by the RoK’s Ministry of Industry, Trade and Energy, the COEX Exhibition and Convention Centre, the Korea Trade-Investment Promotion Agency (KOTRA) and the Association of Korean Exhibition Industry (AKEI), the event is the largest of its kind for the Vietnamese market with an aim to help Korean small and medium-sized enterprises access business opportunities and meet partners from Ho Chi Minh City and major Vietnamese cities.

As many as 60 manufacturers in the RoK introduce their products in the categories of quarantine, health care and digital equipment, mostly masks, rapid test kits, hand sanitisers, distant body temperatures, syringes, mobile testing stations, oxygen ventilators, and artificial intelligence-based test kits.

Exhibitors at the event also have a chance to learn about the Vietnamese market, making it easier for them to devise online marketing plans and introduce quality products./. 

IHS Markit positive about Vietnam’s economic recovery

The IHS Markit Vietnam manufacturing purchasing managers’ index (PMI) for October 2021 showed a strong rebound in the manufacturing sector, the UK-based market research firm said in a recent analysis published on ihsmarkit.com.

According to the article, the nation’s economic recovery still faces headwinds due to a renewed upturn in daily new COVID-19 cases as well as continuing supply chain disruptions.

As daily new COVID-19 cases started to decline during the second half of September and early October, easing lockdown restrictions allowed the reopening of many factories, resulting in a sharp rebound in the IHS Markit Vietnam Manufacturing PMI to 52.1 in October.

During the third quarter, severe disruption to supply chains were noted by firms in the PMI survey results. Companies linked longer lead times to difficulties with transportation both domestically and internationally due to the pandemic, as well as raw material shortages. Manufacturers were also faced with surging input costs. Shortages of labour also contributed to rising backlogs of work, as migrant workers returned to their home provinces and towns during the protracted lockdowns and widespread factory closures.

It said the economic impact of the pandemic is expected to recede during 2022 as vaccination rollout becomes more widespread across the population of Vietnam.

Over the medium-term outlook for the next five years, a number of key drivers are expected to continue to make Vietnam one of the fastest growing emerging markets in the Asian region.

Firstly, Vietnam will continue to benefit from its relatively lower manufacturing wage costs. Secondly, Vietnam has a relatively large, well-educated labor force compared to many other regional competitors in Southeast Asia, making it an attractive hub for manufacturing production by multinationals. Third, rapid growth in capital expenditure is expected, reflecting continued strong foreign direct investment by foreign multinationals as well as domestic infrastructure spending. Fourth, Vietnam is benefiting as a potential market for companies in the current wave of shifting productions to Asia. Fifth, many multinationals have been diversifying their manufacturing supply chains during the past decade to reduce vulnerability to supply disruptions and geopolitical events.

Vietnam is also set to benefit from its growing network of free trade agreements, including the ASEAN Free Trade Agreement (AFTA), the Regional Comprehensive Economic Partnership (RCEP), and the EU – Vietnam Free Trade Agreement (EVFTA).

Despite these near-term risks, over the medium-term economic outlook, a large number of positive growth drivers are creating favorable tailwinds and will continue to underpin the rapid growth of Vietnam’s economy. This is expected to drive strong growth in Vietnam’s total GDP as well as per capita GDP.

Vietnam’s total GDP is forecast to increase from 270 billion USD in 2020 to USD 433 billion USD by 2025, rising to USD 687 billion by 2030. This translates to very rapid growth in Vietnam’s per capita GDP, from 2,785 USD per year in 2020 to 4,280 USD per year by 2025 and 6,600 USD by 2030, resulting in substantial expansion in the size of Vietnam’s domestic consumer market./.

Vietnam’s digital economy expects 31-percent growth this year

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The Vietnamese digital economy will grow by 31 percent this year, reaching 21 billion USD, Temasek, Google and management consulting firm Bain & Company have announced in a recent joint report.

According to the e-Conomy SEA 2021 report, since COVID-19 reappeared in the first half of this year, Vietnam has added 8 million digital consumers, of which more than half come from non-metro areas.

Notably, 99 percent of these new consumers expressed their intention to continue using online services post-pandemic, showing a very high level of adoption of digital services and products of users in our country.

The report noted that the Vietnamese internet economy could reach 220 billion USD in Gross Merchandise Volume (GMV) by 2030, ranking second in Southeast Asia after Indonesia.

It stressed this is welcoming in the context of the shrinking online travel market, and if this growth is maintained, Vietnam’s GMV is expected to reach 57 billion USD by 2025./. 

Customs procedures completed for over 22,000 milk boxes stuck at port

The Vietnam Fatherland Front Committee in HCMC and the local customs agency have coordinated to complete customs clearance for over 22,000 milk boxes presented by the Vietnamese people in Australia and stuck at the Cat Lai Port for nearly a month.

According to the HCMC Department of Customs, after the testing results of the milk boxes for infants up to 36 months old came out, the department asked the Vietnam Fatherland Front Committee in HCMC to get the customs clearance files done, the local media reported.

Pham Minh Tuan, vice chairman of the committee, said the milk boxes would be transported to a warehouse at 55 Mac Dinh Chi Street in District 1 before being distributed to Tu Du and Hung Vuong hospitals, orphanages and social welfare centers of Thu Duc City and 21 districts tomorrow.

Earlier, the HCMC Institute of Public Health and the relevant agencies had taken a milk sample for testing and found that the milk boxes met the safety requirements and were eligible for customs clearance.

The milk boxes arrived at the Cat Lai Port on October 21.

At a session of the National Assembly’s second sitting on November 9, chairwoman of the Vietnam Fatherland Front Committee in HCMC To Thi Bich Chau raised the issue, which later captured public concern.

Oil, gas industry needs more incentives to grow further

In the context of declining oil and gas output, one of the tasks for the Vietnam Oil and Gas Group (PetroVietnam) is to seek and implement solutions to optimise resources at oil lots and fields.

Most of the current oil and gas fields in Vietnam have been put into service since the 1986-2015 period. Many fields with large outputs have been exploited for 15-35 years and are in the final stage of exploitation. The watercut levels of these fields range from 50-90 percent, leading to decreases by about 15-25 percent per year in the output.

Limitations in mechanisms and policies have also hindered search and exploration activities. Therefore, apart from exploration and the signing of new contracts, PetroVietnam has worked on solutions to make the most of the existing blocks and fields.

However, the group is meeting a range of difficulties in terms of legal foundation as the current Oil and Gas Law does not have appropriate regulations for the exploitation of oil and gas after contractors transfer assets and operations to Vietnam.

Currently, a number of oil and gas lots and areas have been transferred to PetroVietnam after exploitation contracts have expired or concluded early.

Under directions of the Prime Minister, PetroVietnam has taken over and maintained the operations in these blocks and areas. However, a suitable legal framework for the work is still lacking.  

Given this, an appropriate mechanism that is legalised is needed to enable State firms to take over such projects quickly.

Maintaining oil and gas activities amid the lack of an official legal framework has also led to passive exploitation and failure in utilising market advantages, as well as potential legal complications.

In addition, in order to maximize the return of oil and gas resources, it requires incentives to stimulate supplementary investment activities.

In fact, in some blocks and fields under expired contracts, small-scale oil and gas reserves have been discovered. However, to exploit oil and gas at these sites, it is necessary to have more favourable conditions than those in valid oil and gas contracts. With the current regulations, contractors are facing an array of difficulties in decision-making.

In its proposal to the draft Oil and Gas Law (amended), PetroVietnam suggested supplementing the legal framework for receiving and managing assets from its contractors (assets not belonging to PetroVientam but managed by the group on behalf of the Government), as well as more preferential mechanisms for some small oil fields or those near the border line.

Over the past years, the oil and gas industry has made important contributions to ensuring national energy security and maintaining economic stability in line with the national development strategy.

Maintaining PetroVietnam’s business performance is considered very important, especially in the context of post-pandemic recovery. The completion of the legal framework is expected to create breakthroughs for the development of the oil and gas industry.

The Vietnam Oil and Gas Group (PetroVietnam) pumped an estimated 17.32 million tonnes of oil equivalent in the first ten months of this year, surpassing the plan for the period by 2.3 percent.

The group’s total revenue reached 464.5 trillion VND (20.1 billion USD), or 83 percent of the yearly plan while its contribution to the State budget hit 58.3 trillion VND, equivalent to 86 percent of the yearly target.

Amid the difficulties caused by the COVID-19 pandemic, the group was among a few oil and gas businesses in the world that managed to post positive growth in the January-October period.

The result is attributable to response measures undertaken by PetroVietnam and its members, including cutting costs. In the past 10 months, the group reduced production costs by 8.1 trillion VND./. 

CAAV proposes full resumption of domestic flights from December

The Civil Aviation Authority of Vietnam (CAAV) has proposed the Ministry of Transport increase domestic flights this month, and resume the normal operation of domestic air routes from December.

In November, the number of two-way flights on Hanoi-HCM City, Hanoi-Da Nang and Da Nang-HCM City routes are expected to increase to 19 daily, of which national flag carrier Vietnam Airlines and Viejet Air each will operate six flights, Bamboo Airways and Pacific Airlines each three flights, and Vietravel Airlines one.

The agency also proposed adjusting flight frequency on other routes to nine each day, with flights to be performed by the four carriers.
The normal flight frequency is set to be resumed from December.

In addition, the CAAV said airlines should be allowed to continue providing in-fight services, especially food, to support service suppliers.

According to the agency, between October 21 and November 3, four domestic airlines, except Vietravel Airlines, had restored domestic flights, with a total of 979 round-trip flights carrying 170,200 passengers on 42 domestic air routes.

The CAAV has also sent a document to relevant agencies regarding the launch of pilot international flights, under which regulations on COVID-19 prevention and control must be observed at airports./.

Exports to U.S. rise by 23% in Jan-Oct

Revenue from goods exports to the United States amounted to US$76.8 billion between January and October, up 23.1% year-on-year, according to statistics from the General Department of Vietnam Customs.
The United States became Vietnam’s largest buyer of commodities over the past 10 months.

Vietnam exported computers, electronics products and accessories worth a total of US$10.5 billion to the United States during the 10-month period, up 23.8% year-on-year. In addition, the export revenue of machinery, equipment and components to the U.S. over the past 10 months soared by 47.2% year-on-year, at US$13.4 billion, while the export of smartphones and accessories to this market inched up 1.4%.

Also, between January and October, the United States was Vietnam’s largest footwear importer, with a value of US$5.9 billion, up 18.2% year-on-year, while apparel exports stateside fetched US$12.8 billion during the 10-month period, up 10.2% year-on-year.

Meanwhile, Vietnam saw its goods imports from the United States between January and October rise by 12.6%, year-on-year, at US$12.8 billion.

In the year to October, Vietnam spent US$269.65 billion importing goods, up 28.3% year-on-year, while exporting goods worth US$269.77 billion, up 17.4%. As such, the country enjoyed a modest trade surplus of some US$120 million during the period.

Shopping season 2021 launched in HCM City

Ho Chi Minh City’s Department of Industry and Commerce (DoIC) in collaboration with the departments of Tourism and Health on November 15 launched the largest concentrated promotion programme entitled “Shopping Season 2021″.

The programme will last until December 31.

According to Bui Ta Hoang Vu, Director of the DoIC, the promotion programme aims to promote domestic consumption, connect supply and demand of goods, and assist businesses in restoring production and business in the “new normal”. It is expected to expand trade activities between localities, especially the southern region in the last months of the year.

Enterprises participating in the programme will carry out many promotional activities, especially they can apply a maximum promotion limit of up to 100 percent instead of the normal rate of 50 percent, he said.

Nearly 600 businesses have registered to join in with the promotion ranging from 30 percent to 70 percent, according to the DoIC. 

Addressing the opening ceremony for the event, Phan Thi Thang, Vice Chairwoman of the municipal People’s Committee, said the promotion programme gathered a large number of reputable producers in various fields who have been trusted by consumers.

Thang said she believes these enterprises with high-quality products will help consumers have a shopping experience with the best services and the most reasonable prices./.

Clean energy development helps Vietnam reduce dependence on imports: official

The increasing proportion of clean energy such as solar and wind power in recent years has helped Vietnam diversify energy sources and reduce its dependence on imported energy, thus enhancing its national energy security, said Director of the Ministry of Industry and Trade’s Department of Electricity and Renewable Energy Hoang Tien Dung.

In a recent interview granted to the Vietnam News Agency (VNA), Dung underlined the important role of energy in the process of electricity production, as well as in all economic activities, saying that this will affect Vietnam’s economic recovery in the coming time as Vietnam is in the process of energy transition.

According to the official, many countries around the world are facing an energy crisis, which puts them at risk of power shortages.

At the 26th United Nations Climate Change Conference of the Parties (COP26) in Glasgow, the UK, Vietnamese Prime Minister Pham Minh Chinh pledged to achieve the target of net-zero emissions by 2050.

However, it is not easy to carry out the energy transition towards green energy while ensuring national energy security in this process, Dung said.

He stressed that it is necessary to promote energy saving and efficient use to reduce the demand for energy.

The development of renewable energy sources should be stepped up with a feasible roadmap suitable to the investment cost for renewable energy technologies and selling prices of electricity, he said, adding that attention should be also paid to developing infrastructure serving the import of electricity and primary energy.

Vietnam is a net energy importer with significant imports of coal and oil at present, and liquefied natural gas (LNG) in the near future. The biggest impact from the current energy crisis on Vietnam’s energy industry can be seen that the prices of imported energy will increase in accordance with the global energy prices.

For Vietnam, ensuring the supply of fuel and energy in the short term has not yet faced complicated issues thanks to long-term coal and gas import contracts. However, ensuring the supply of fuel for domestic coal and gas-fueled power plants in the coming time requires unified management.

The development of renewable energy sources must be carried out in harmony with the development of the country’s electricity system in particular and the energy system in general, he said.

According to the official, the radical development of renewable energy sources is an inevitable trend, but it is also necessary to consider issues related to ensuring the reliability of power supply, diversification of power sources and ensuring that electricity prices are affordable./.

Vietnamese real estate startup raises 30 million USD of funding

Homebase, a Vietnamese proptech startup, has raised 30 million USD of funding from many world leading adventurous funds including Y Combinator, Partech Partners, Goodwater Capital, Ace and Company and Emles Advisors.

Homebase had earlier successfully called for funding from many investors such as VinaCapital Ventures; Brian Ma, co-founder and former CEO of Divvy Homes; Troy Steckenrider III, former chief operating officer of Zerodown; and 99.co founder and CEO Darius Cheung.

Vietnam is one of the fastest growing real estate markets in the world, but the chance for young people to have their own house is becoming harder.

Statistics from CBRE showed that in the third quarter of 2021, housing prices in Ho Chi Minh City rose 3-17 percent.

Founded in 2019, Homebase provides revolutionary and accessible products that empower homeowners to buy, sell, and own homes in ways that work best for themselves.

Tracy Vu, Homebase Director for Business Development said that the firm hopes to work more closely with leading real estate companies in Vietnam to help more Vietnamese people to own their own house, and get more chances to work with real estate brokers to access better financial tools to serve customers./.

Bac Giang secures successful lychee crop in trying time

When the lychee harvest time of 2021 came, Bac Giang was still a COVID-19 epicentre with thousands of infection cases. Striving to concurrently fight against the pandemic and promote lychee sale, this northern province took flexible and creative measures to secure a successful crop.

A lychee crop with two records

The 2021 lychee crop of Bac Giang was said to have the best quality and the largest output compared to previous years. Total lychee output exceeded 215,800 tonnes, rising by over 50,000 tonnes from 2020.

Of this volume, over 58,800 tonnes were early-ripening lychees and 157,000 tonnes were fruits of the main crop, up 11,100 tonnes and 39,700 tonnes year on year, respectively.

The local lychee had found their way into almost all supermarket networks across Vietnam such as Big C, Saigon Co.opmart, Hapro, Aeon, Lotte, and Vinmart, as well as shopping malls, convenience stores, wholesale markets, and traditional markets.

In particular, the fruit was sold on social networks like Facebook, Zalo, and Youtube, along with large domestic and international e-commerce platforms, including Voso, Sendo, Tiki, Shopee, Lazada, Postmart, and Alibaba with a record volume – more than 6,000 tonnes.

The province enjoyed stable lychee export this year. The local fruit speciality has gained a foothold in many countries and territories around the world. The export volume reached 89,300 tonnes, accounting for 41.4 percent of the total sold figure.

Apart from the traditional and largest market of China, the lychee was also shipped to the EU, the US, Australia, Japan, the Republic of Korea, Southeast Asia, and the Middle East.

Despite certain disadvantages caused by the COVID-19 pandemic, this year’s lychee prices stayed stable throughout the crop, comparable to or even higher than prices in the pre-pandemic period.

Bac Giang earned over 6.8 trillion VND (299.6 million USD) in lychee sales and revenue of support services, including 4.27 trillion VND in sales. Selling prices averaged 19,800 VND per kg in the domestic market during the crop.

The fruit has won over high evaluation from consumers in demanding markets such as Japan, the US, the Netherlands, Belgium, France, Germany, China, and some countries in the Middle East and Southeast Asia. Export prices were also high, ranging between 30,000 VND and 55,000 VND per kg.

Flexibility, creativity in lychee promotion

From the start of the crop, the provincial People’s Committee issued a plan on the organisation of promotion activities to boost lychee sale.

Partners such as Aeon, Central Group, Mega Market, and Big C sent their representatives to work with Bac Giang businesses to make preparations ahead of the harvest time. More than 50 contracts were signed, involving a lychee volume much higher than in previous years.

In May 2021, the provincial Department of Industry and Trade coordinated with the Tan Yen district People’s Committee to hold a ceremony marking the first batch of lychee destined for Japan.

Although Bac Giang was still an epicentre of COVID-19 in early June, its People’s Committee worked with the Ministry of Industry and Trade, the Ministry of Agriculture and Rural Development, ministries, and central agencies to successfully organise a teleconference promoting the sale of lychee. The event attracted participants from across Vietnam and China, Japan, Singapore, and Australia via videoconference.

At that meeting, the Bac Giang lychee officially made debut on major e-commerce platforms of Vietnam and the world.

In addition, the Department of Industry and Trade kept cooperation with relevant agencies of the trade and agriculture ministries to take part in online meetings and discussions to connect with businesses and importers in Japan, Australia, the EU, and China, among others.

Proposals were submitted to the Government, the Prime Minister, ministries, sectors, and other localities to seek the best possible conditions for the transportation of lychee in the domestic market and to foreign destinations.

The provincial administration also ordered the Industry and Trade Department to actively work with the Vietnam E-Commerce and Digital Economy Agency (the Ministry of Industry and Trade) and the Department of Posts (the Ministry of Information and Communications) to support the distribution of lychee via e-commerce platforms.

Provincial authorities also helped local enterprises and cooperatives to open stores on large online shopping platforms, facilitating the fruit’s access to the domestic and foreign markets.

Vice Chairman of the provincial People’s Committee Phan The Tuan said thanks to the proactive, drastic, and creative actions, as well as the involvement of the entire political system, Bac Giang obtained a successful lychee crop amid the trying time./.

Vietnamese e-commerce market receives huge investment

Telio, the first business-to-business (B2B) e-commerce platform in Vietnam, has received funding of 22.5 million USD from Vietnamese tech unicorn VNG, raising total investment that it had attracted as of September 2021 to 51 million USD.

One week ago, domestic e-commerce platform Tiki also mobilised 258 million USD in a funding round led by AIA Insurance Inc. The new investment could help the platform shorten its plan to organize an IPO (initial public offering) in the US, which is initially scheduled for 2025.

At the same time, Alibaba, after pouring more than 4 billion USD into Ladaza, shook hands with Baring Private Equity Asia (BPEA) to invest 400 million USD in The CrownX of Masan Group. The deal is expected to help Masan complete its online business in Vietnam.

E-commerce has emerged as a growth pillar for the digital economy of Southeast Asian countries, including Vietnam. This year, the digital economy of Vietnam is forecast to grow 31 percent to 21 billion USD thanks to a year-on-year rise of 53 percent in e-commerce, and is predicted to hit 57 billion USD in 2025.

Mitch Bitterman, Executive Vice President for E-commerce in Asia of TMX Global said that Vietnam is the third largest e-commerce market in Southeast Asia after Indonesia and Thailand. This development trend is expected to continue when the country pushes forward with its national digital transformation project, which is supported by its young population and expanding online shopping habit, he held.

Vietnam’s e-commerce market has continuously received huge investment. Major players of Shopee, Ladaza, Tiki and Sendo have been pumped with capital to expand market share and business scale. At the same time, multinational firms such as Grab, Gojek and Amazon have also shown interest in the promising market.

Meanwhile, Vietnamese giants such as Masan, Vingroup, Viettel and The gioi Di dong have also switched their focus onto e-commerce.

Industry insiders held that more merge and acquisition (M&A) deals will take place in the time to come, making the Vietnamese market more attractive but with fiercer competition./. 

Vietnamese farm produce sell well in Australian market

Vietnamese agricultural exports to the Australian market have been witnessing impressive growth in recent times thanks to their high quality, diverse brands, and trade promotion activities.

Ngo Tuong Vy, deputy director of Chanh Thu Fruit Import-Export Limited Company, said due to the adverse impact caused by the COVID-19 pandemic, the company has moved to promote the consumption of processed frozen products, especially frozen Ri6 durian, which have won the trust of Australian consumers.

“Beyond our expectations, frozen Ri6 durian products sell well in Australia, and we have received large orders from our partners,” Vy told cong thuong (Commerce) newspaper, revealing that her firm plans to cooperate alongside other localities to expand durian growing areas to meet the requirements for export.

Meanwhile, Uu Dam company has recently exported 2,000 fresh wax coconuts from the Mekong Delta province of Tra Vinh to this market by air. It offered the new product at a price of roughly US$26 each and got the nod from the importer.

Other local farm produce such as pepper, coffee, and seafood have become increasingly popular within the Australian market.

Nguyen Phu Hoa, deputy Consul General in Sydney and Head of the Vietnamese Trade Office in Australia, revealed that coffee exports to this market in September soared by 41% compared to the previous month, and that consumption demand is projected to rise in the near future.

At present, Vietnam makes up the largest pepper exporter to Australia, with an export proportion accounting for between 50% and 60%. Last year saw the country export 2,630 tonnes of pepper to Australia, representing an increase of 30.47% year on year.

As a way of introducing Vietnamese goods to Australian consumers, the Vietnamese Trade Office in Australia has recently deployed a range of trade promotion activities, including a durian marketing campaign in which Australian people were invited to taste durian fruit in an antique car on the streets of Sydney. The office also launched other promotion programmes such as “Vietnam, Land of World’s Best Rice” and “Vietnam Cashew Week” in Melbourne.

Along with trade promotional drives, businesses have been advised to grasp customer tastes to improve overall product quality and build stronger brands for their products to meet stringent requirements set by the Australia market, according to experts. 

Clean energy development helps Vietnam reduce dependence on imports: official

The increasing proportion of clean energy such as solar and wind power in recent years has helped Vietnam diversify energy sources and reduce its dependence on imported energy, thus enhancing its national energy security.

Director of the Ministry of Industry and Trade’s Department of Electricity and Renewable Energy Hoang Tien Dung said in a recent interview granted to the Vietnam News Agency (VNA).

He underlined the important role of energy in the process of electricity production, as well as in all economic activities, saying that this will affect Vietnam’s economic recovery in the coming time as Vietnam is in the process of energy transition.

According to the official, many countries around the world are facing an energy crisis, which puts them at risk of power shortages.

At the 26th United Nations Climate Change Conference of the Parties (COP26) in Glasgow, the UK, Vietnamese Prime Minister Pham Minh Chinh pledged to achieve the target of net-zero emissions by 2050.

However, it is not easy to carry out the energy transition towards green energy while ensuring national energy security in this process, Dung said.

He stressed that it is necessary to promote energy saving and efficient use to reduce the demand for energy.

The development of renewable energy sources should be stepped up with a feasible roadmap suitable to the investment cost for renewable energy technologies and selling prices of electricity, he said, adding that attention should be also paid to developing infrastructure serving the import of electricity and primary energy.

Vietnam is a net energy importer with significant imports of coal and oil at present, and liquefied natural gas (LNG) in the near future. The biggest impact from the current energy crisis on Vietnam’s energy industry can be seen that the prices of imported energy will increase in accordance with the global energy prices.

For Vietnam, ensuring the supply of fuel and energy in the short term has not yet faced complicated issues thanks to long-term coal and gas import contracts. However, ensuring the supply of fuel for domestic coal and gas-fueled power plants in the coming time requires unified management.  

The development of renewable energy sources must be carried out in harmony with the development of the country’s electricity system in particular and the energy system in general, he said.

According to the official, the radical development of renewable energy sources is an inevitable trend, but it is also necessary to consider issues related to ensuring the reliability of power supply, diversification of power sources and ensuring that electricity prices are affordable.

Vietnam – bright spot in world’s AI market

Vietnam has emerged as a bright spot in the world’s artificial intelligence (AI) market, as Vietnamese representatives have continuously been invited to introduce their products and research studies at global AI events.

The primary aim of the conference is to showcase the most innovative and original technological ideas and other developments from around the world (Illustrative photo: tapchitaichinh.vn)
Most recently, DrAidTM, developed by VinBrain (Vingroup), has been awarded the ACM SIGAI Industry Award 2021 for Excellence in Artificial Intelligence.

As the world’s top award in the field of artificial intelligence, this award is granted to only one AI product per year.

The ACM SIGAI Award is held by the Association for Computing Machinery’s Special Interest Group on Artificial Intelligence (AI) – the world’s largest scientific and educational computing society, established in 1947 with nearly 100,000 members.

DrAidTM, the first complete AI product of healthcare in Vietnam, was among the three Vietnamese representatives at the Nvidia’s GPU Technology Conference (GTC), which took place from November 8-11 and brought together more than 200,000 international researchers and leaders in the AI field.

The primary aim of the conference is to showcase the most innovative and original technological ideas and other developments from around the world.

DrAidTM was launched in June 2020, and is capable of detecting and screening over 21 abnormal signs and pathologies of Lung – Heart – Bone within 5 seconds with an accuracy of over 89 percent and sharing diagnostic results via QR code or link.

In particular, it is capable of self-warning of COVID-19, including asymptomatic cases or mild lung injury based on upright chest X-Ray and improving accuracy in addition to reducing false negatives when being used in combination with PCR test.

The Ho Chi Minh City Department of Health has put DrAid into use at hospitals and medical centres in the southern metropolis, and initially gained significant results in COVID-19 response.

Statistics by the World Intellectual Property Organisation (WIPO) show that, as of 2018, among six ASEAN countries with AI inventions, Vietnam ranked second with a total of 372 AI patent applications.

Between 2016 and 2020, the country counted 96 AI-related projects with total investment amounting to VND169.2 billion (US$7.47 million).

Hải Dương Red Cross Society supports the poor with new homes

Standing in her new house, Nguyễn Thị Bích, a woman from Tứ Cường Commune, Thanh Miện District, Hải Dương Province, was over the moon.

In 2019, she was presented with a new house by the provincial Red Cross Society (RCS) after many years living in poor conditions.

She is one of hundreds of poor households which have received support from the provincial Red Cross Society over the past five years.

RCS built and donated more than 100 houses to 103 poor families in Thanh Miện district in 2019, with total investment of VNĐ13.5 billion (over US$596,800).

For each newly-built house, 50 per cent of the total cost is from RCS’s fund and the remainder from the locality and other sources.

Statistics from the local Department of Labour, War Invalids and Social Affairs shows that there are over 2,000 poor and near-poor people in Thanh Miện District, over 1,000 Agent Orange and dioxin victims, and over 2,600 people with disabilities and 279 lonely elderly people.

“Families are very happy when they are presented with a new house. Their happiness is also our happiness,” said Vũ Thị Vân Anh, vice president of Thanh Miện District’s Red Cross Society. 

RCS has worked with local authorities and called on support from other sources to build houses for the poor families, Anh said.

During the 2016-21 period, Hải Dương Province’s RCS called on businesses and benefactors to build 307 new houses and repair 27 homes for families living in disadvantaged circumstances, worth over VNĐ23.4 billion ($1 million). 

Vũ Nguyên Đăng, an official from the provincial RCS, said: “In the past five years, the agency has mobilised more than VNĐ154 billion ($6.8 million) from locals and donors to help over 290,000 people.” 

The RCS’s efforts have brightened up the lives of many poor people.

The agency will strengthen and effectively implement humanitarian programmes to increase the support for disadvantaged people in the province, Đăng said. 

Thua Thien-Hue tourism faces labour shortage

Tourism firms in the central province of Thua Thien-Hue Province are facing labour shortage after a long closure due to the Covid-19 pandemic.

Two years since the pandemic hit the tourism sector, many firms have closed, forcing their staff to switch to other work.

Nguyen Duy Kinh used to be a tour guide for five years before having to stop and become a taxi driver since the pandemic hit Vietnam two years ago. He said that like him, many of his colleagues in Hue have had to look for jobs and have gradually adapted to their new working environment.

“We are still not sure about the development of the tourism sector in the coming time,” Kinh said. “Over the past two years, we had waited for the Covid-19 pandemic to end and returned to our work several times but then had to leave again following new outbreaks. We had faced a very uncertain life and now we have to think carefully before deciding to return to our old work.”

CEO of the Alba Spa Hotel Hue, Chau Thi Hoang Mai said that staff is now the biggest problems for them and many other hotels in the area.

“We are facing some difficulties recruiting new staff,” Mai said. “We are now having to mobilise staff members from other hotels in our group to serve the rising number of customers. But we will have to try to employ new employees for our new plans.”

Statistics showed that Thua Thien Hue Province used to have over 14,000 full-time employees and over 30,000 others doing part-time jobs for the local tourism sector. The number of full-time employees had reduced by a half in 2020 and to only 3,000 now.

According to deputy director of the provincial tourism department, Nguyen Van Phuc, they have completed Covid-19 vaccination for all labours of the tourism sector to prepare for resumption.

“We have also worked with local tourism firms and provided training for their staff on new products and services that are suitable for the new normal period during the pandemic time,” he said. “I think we now need to learn to live with Covid-19.”

Tourist destinations and historical relics in Thua Thien-Hue have resumed operation since late September after over a month of closure.

PV Gas plans to start importing LNG in 2022

PetroVietnam Gas (PV Gas) is prompting the completion of its infrastructure system to start importing LNG from 2022, compensating for a decline in domestic gas sources, and to promote the development of gas/LNG in Viet Nam, the company’s Board of Directors said.

The decision is based on Resolution 55-NQ/TW approved by the Politburo on February 11, 2020 on Viet Nam’s national energy development strategy to 2030.

Currently, PV Gas is focusing on the construction of a storage project with a capacity of one million tonnes of LNG/year in Thi Vai. So far, Thi Vai LNG warehouse project is about 90 per cent complete. It is expected to be completed and put into operation in the third quarter of 2022. Other projects, including an LNG station for tankers in Thi Vai, are also being implemented.

PV Gas is also investing in infrastructure for importing, storing and distributing LNG nationwide. Of which each region will be supplied by three LNG hubs, including the Thi Vai LNG storage project in the south, Son My LNG storage facility in the central region and storage in Quang Ninh/Hai Phong/Thanh Hoa in the north.

To utilise the gas infrastructure system, PV Gas plans to turn LNG terminals into mixed ports with additional functions of importing and exporting liquid products and logistics services to provide services to customers.

Regarding LNG import sources, PV Gas focuses on preparing short and medium-term import sources. It has signed six matched sale-purchase agreement (MSPA) with LNG suppliers.

PV Gas became one of the five businesses with market capitalisation of over US$10 billion in November after its stock price rose 48 per cent since the beginning of this year and hit a record at VND125,000 per share in October, pushing the firm’s market cap to VND238.28 trillion ($10.54 billion).

In the last quarter, the company posted consolidated profit after tax of VND2.46 trillion, up 19.1 per cent year-on-year.

LNG is liquefied natural gas. With much smaller volume compared to natural gas, LNG is a convenient gas product for storage and transportation from the origin of production to markets.

LNG is used to serve the needs of power plants, industrial households and urban areas. Currently, LNG is also used as fuel for vehicles like ships, trains and heavy trucks to reduce environmental pollution. 

Norway to partner with Vietnam to “awaken” offshore wind power potential

Norwegian Ambassador to Vietnam Grete Løchen and Commercial Counsellor Arne-Kjetil Lian recently have handed over the ‘Vietnam Supply Chain Study Report’ to Vietnamese Minister of Industry and Trade Nguyen Hong Dien.

Hanoi – Norwegian Ambassador to Vietnam Grete Løchen and Commercial Counsellor Arne-Kjetil Lian recently have handed over the ‘Vietnam Supply Chain Study Report’ to Vietnamese Minister of Industry and Trade Nguyen Hong Dien.

The 70-page report provides an overview of the entire supply chain for Vietnam’s offshore wind industry, recommendations on what Vietnam can prioritise to stimulate the strong growth of a local supply chain to create jobs for skilled labourers, and export to offshore wind markets in the region and the world.

The report also highlights opportunities that offshore wind will bring to Vietnamese suppliers, and areas where Norwegian and other foreign companies can collaborate with Vietnamese partners to promote offshore wind power projects.

Although challenges related to institutional framework and policy still need to be addressed in order to support the implementation of large-scale offshore wind power projects, many international developers and investors, including Norwegian companies have been preparing to tap these opportunities.

Technology is an important element in offshore wind power development and this is also the strength of Norwegian companies, Counsellor Lian stressed.

The Norwegian business community is ready to partner with Vietnamese companies, and share experience and technology to help Vietnam build a strong domestic supply chain, he added.

With over 3,000 km of coastlines, Vietnam boasts an abundant offshore wind resource and is an emerging market for offshore wind.

According to the World Bank, offshore wind is capable of meet 12 percent of Vietnam’s electricity demand by 2035. By gradually replacing coal-fired electricity, this could help reduce over 200 million metric tonnes of CO2 emissions and add at least 50 billion USD to Vietnam’s economy from a strong local supply chain, more jobs, and exports.

Consumers become more prudent in post-pandemic personal finances

The COVID-19 pandemic has transformed the personal finance landscape, with consumers now more conservative about their short-term spending habits and more prudent in their long-term financial plans.

While consumers are more conservative in their spending, they have also become more modern
According to the Personal Finance in Vietnam Report 2021 by YouGov, Vietnamese consumers’ confidence in the improvement of the COVID-19 situation has shot up since lockdowns ended in Vietnam, with optimism rising from around 30 per cent in September to almost pre-pandemic levels of 80 per cent in October. However, despite the positive outlook for the “new normal”, families are still dealing with the impact of COVID-19 on their personal finances, which have seen a significant hit in 2021 compared to previous outbreaks.

Just under half of all people (48 per cent) have seen their income fall in 2021. More than a quarter (28 per cent) reported a slight decrease of between 10-20 per cent. Meanwhile, one-fifth (20 per cent) saw an even sharper fall of at least 20 per cent.

On a positive note, over one-third of Vietnamese (38 per cent) were able to increase their savings during the pandemic, with work-from-home mandates leading to reduced spending on non-essential items such as travel, leisure, and eating out. This is the highest rate in the region, just ahead of Hong Kong and far ahead of Singapore. However, others were less fortunate, with more than a third (34 per cent) of Vietnamese dipping into their savings and a fifth (21 per cent) borrowing cash to get through the outbreak.

This has caused consumers to re-evaluate their current spending habits and re-assess their long-term financial plans. Over half (53 per cent) of Vietnamese cut down on non-essential spending in the last six months. Meanwhile, more than four-fifths (81 per cent) plan to do so in the future.

Vietnamese consumers are now some of the most prudent in the world. Two-thirds (67 per cent) are more careful with their personal finances than before the pandemic. Meanwhile, a third (34 per cent) prioritise protecting their household finances in case of emergencies. That is almost 10 per cent higher than the global average. Vietnamese are also more keen to invest and reduce their debts than the average consumer elsewhere in the world.

However, while Vietnamese consumers are becoming more conservative in what they spend, they are also becoming more modern in how they spend it. E-commerce grew even more popular in 2021, while cashless transactions saw a boost during lockdown and e-wallets continue to gain traction. Consumers have become more confident managing their finances online and this digital financial trend is set to continue post-pandemic.

Potential from adventure tourism exploited

In recent years, many provinces and cities have been focused on developing adventure tourism becoming an accessible and attractive tourism product. Although it is considered to have many advantages to develop this product line, adventure tourism in Vietnam has not yet been promoted and exploited to its full potential.
Growing trend

At the webinar themed “Development of adventure tourism products in the Northeast”, Director of the Institute for Tourism Development Research Nguyen Anh Tuan said that adventure tourism is a growing trend, becoming more and more popular in the world and attracting many tourists to explore and experience. With the advantage of many hills, caves, rivers and streams, Vietnam has great potential for developing adventure tourism.

This can be divided into a variety of products within adventure tourism: Adventure tourism in the air (travel by helicopter, paragliding, and skydiving); adventure tourism products on land (picnic tourism, mountain climbing, walking, and balancing on a rope); Water adventure tourism (boating, waterfall discovery, and diving).

In fact, for many years, adventure tourism has been a “unique and strange” tourism product line, exploited by many travel agencies. Numerous provinces and cities, such as Ha Giang, Bac Kan, Lao Cai, Lai Chau, Quang Ninh, Quang Binh, Nghe An and Hanoi, have had strategies to promote such adventure tours.

Typically, the Northeast – Northwest regions have many tourism products, such as: Conquering Fansipan peak (Lao Cai province), Bach Moc Luong Tu (Lai Chau province), Tay Con Linh mountain peak (Ha Giang province), Ban Gioc waterfall (Cao Bang province), exploring caves in Ba Be National Park (Bac Kan province). In the central region, adventure tourism stands out especially products of cave exploration in Quang Binh province and conquering the peak of Pu xai lai leng (Nghe An province). In Hanoi, Ba Vi National Park Management Board has been conducting climbing tours to explore the National Park for many years.

As a travel agency that has strengths in adventure tourism and is building caravan products combined with trekking (hiking, climbing), Director of Fivestar Tourism Company Luong Duy Doanh said that the adventure tour can only be organised for groups of 30 people or less, in accordance with the requirements of epidemic prevention. Therefore, adventure tours will be safe products, after the COVID-19 epidemic is under control.

Meanwhile, Vice Chairman of Bac Kan Tourism Association, Director of Mr Linh’s Adventures Travel Company Nguyen Tuan Linh said that adventure tourism is opening up opportunities for localities, especially in mountainous areas. This is a product line capable of attracting long-stay visitors and guests who spend more money.

Although there are many potentials and advantages, adventure tourism in Vietnam is not well known to many people. According to Deputy Director of the Institute for Tourism Development Research Truong Sy Vinh, the development of adventure tourism faces limitations in terms of organisation and infrastructure in certain localities. In addition, the connection between the locality and tourism businesses is not ideal, leading to fragmented and inconsistent exploitation.

According to Standing Vice Chairman of the Vietnam Tourism Association Vu The Binh, in order for adventure tourism products to develop commensurate with their potential, localities need to have specific mechanisms and policies to attract strategic investors. Each locality should build a specific product, avoiding duplication and monotony.

On the side of travel businesses, Director of Vplus Vietnam Travel and Events Joint Stock Company Nguyen Duc Anh said that it is necessary to strengthen coordination between sectors and localities in the management and exploitation of tourism resources. Localities need to coordinate with reputable travel agencies to survey, develop products, and implement a set of safety criteria for tourists.

Meanwhile, Director of Fivestar Tourism Company Luong Duy Doanh said that in order to improve the quality of adventure tourism products, in addition to investing in infrastructure, localities should focus on training tour guides at the destination; improving the skills and qualifications of the local guides to help them meet the set requirements. “In order to develop adventure tourism and ensure the safety of tourists, the organisers need to improve professionalism in consulting on health and insurance; fully equipped with essential items and warn about the risks for tourists”, said Luong Duy Doanh.

Adventure tourism is being exploited to bring benefits to localities and organisations. However, according to Deputy Director of the Hanoi Department of Tourism Tran Trung Hieu, in order for this type to develop and attract tourists, localities need to have a long-term strategy in calling for investment and building assurance standards for visitors as well as environmental protection.

“Coming here, the Hanoi Department of Tourism will organise survey groups in the Ba Vi area to build more adventure tourism products, in order to increase the attractiveness of the capital’s tourism,” said Tran Trung Hieu.

Vietnam promotes export of key agricultural products

The European Union (EU) is Vietnam’s leading agricultural export market. The import demand of this market has also begun to increase rapidly because of the control of the COVID-19 pandemic, creating excellent opportunities for Vietnamese enterprises to boost the export of key agricultural products.

According to the Ministry of Agriculture and Rural Development, in the first 10 months of 2021, the export value of Vietnam’s agricultural, forestry and fishery products to markets in Europe accounted for 11.4% of the total market share with diverse products such as seafood, rice, and fruit.

This is not a large number compared to the Asian market (42.8% market share) and the American market (30% market share) because of the impact of the COVID-19 pandemic and strict requirements in terms of food quality and safety.

According to Director of the European – American Market Department (Ministry of Industry and Trade) Ta Hoang Linh, the EU is a major export market for Vietnam’s agricultural and aquatic products. However, the output and export value of most products remain low, not commensurate with the market capacity and trade relations between Vietnam and the EU.

The EU is Vietnam’s fourth largest market of seafood with an annual export value of over USD $1 billion from 2015 to 2019. However, due to the European Commission (EC)’s “yellow card” warning on Vietnamese fishing, the export of this item to Europe has decreased in recent years.

Regarding vegetables and fruits, the EU is also Vietnam’s fourth largest fruit and vegetable export market, but Vietnam ranks only 25th among fruit and vegetable supply markets to the EU with a market share of only about 1%.

General Director of Vina T&T Group Nguyen Dinh Tung said Vietnam’s vegetables and fruits exported to the EU are mainly fresh, raw and processed products. Deeply processed products are very modest, so the added value is not too high. Therefore, Vietnam’s fruit and vegetable market share in the EU is currently small while the market demand is very large.

Therefore, exporters must constantly improve product quality and fully ensure the requirements and standards of the EU to achieve rapid growth, especially as the EU commits to removing 94% of the total 547 tax lines on Vietnamese fruits and vegetables following the effectiveness of the EU-Vietnam Free Trade Agreement (EVFTA).

The EU is also Vietnam’s largest coffee consumption market, accounting for nearly 40% of Vietnam’s total volume and 37% of total export turnover. Vietnam’s coffee export turnover to the EU has remained at US$1.2 – US$1.4 billion per year over the past five years.

With advantages from the EVFTA, Vietnamese coffee products can increase exports to the EU market in the near future. In addition, Buon Ma Thuot coffee is one of the 39 geographical indications of Vietnam that the EU committed to protect since the EVFTA officially came into effect.

According to the European – American Market Department, the supply of goods to the EU market has been disrupted due to the pandemic which is considered a great opportunity for Vietnamese exporters to take advantage of.

One of the long-standing limitations of Vietnamese agriculture is that we are selling what we have without focusing on researching and understanding thoroughly what the market needs. Therefore, the situation of “bumper harvest resulting in declining prices” is still happening in many localities.

Due to the lack of market information, many export agricultural products offered for sale have yet to attract importers, especially in markets with high requirements for quality, design and safety like in Europe.

Vietnamese trade counselor in Italy Nguyen Duc Thanh said Vietnamese businesses need to meet consumer tastes regarding packaging and food safety as well as labour and environment standards. Thanh noted that Vietnamese key products such as seafood, tea and coffee can be promoted further into the Italian market.

Particularly for rice products, there is still plenty of room for Vietnamese rice because Italy is a large importer within the EU. Italy imported about 221,000 tonnes of rice (equivalent to US$174 million) from countries around the world, but it imported only 7,000 tonnes from Vietnam worth about US$5 million, accounting for 3.1% of Italy’s total rice import market share. Meanwhile, the imported figure was 70,000 tonnes (equivalent to US$64 million) from Pakistan, 19,000 tonnes (US$21 million) from Thailand, and 16,000 tonnes (US$18 million) from India.

Meanwhile, Vietnamese Trade Counselor in Spain Vu Chien Thang said food safety and hygiene is the top concern for the Spanish market. Seafood exporters such as tuna, shrimp, and squid to the Spanish market need to fully meet standards on food safety and hygiene including catching, preservation, processing and transportation.

In addition, Spain is also increasingly interested in corporate social responsibility in the production and export of goods. Specifically, the employers must commit to ensuring standard working conditions for all workers and safe production in terms of human and environmental protection without using forced labour or child labour.

The EU in general and Spain in particular attach great importance to social responsibility of businesses, considering it as a binding condition in conducting trade transactions. This is an issue that Vietnamese agricultural exporters need to pay specific attention to.

It can be seen that market demand is an important factor to calculate the production and processing planning of agricultural products, especially for a large and demanding market like the EU.

Therefore, Vietnamese relevant ministries and sectors have coordinated in organising many seminars to connect Vietnamese agricultural exporters with this market. Both sides discussed supply and demand issues, legal factors in export activities, consumer psychology, and local culture so that Vietnamese producers and exporters can have a comprehensive view of the EU market in order to effectively conquer this market with all its potential and value.

Enterprises face dual difficulties

The transportation sector has been seriously affected by the Covid-19 pandemic. Now, with high gasoline prices, most transport enterprises suffer more difficulties.

At the delivery truck stop near the Go May – National Highway 1 intersection in Binh Tan District, many trucks have been parking here for 3-4 days, but there are still not enough goods for them to leave the stop. Mr. Nguyen Van, whose delivery trucks carry goods from Ho Chi Minh City to Central provinces, said he had about 200 delivery trucks, but only 22 vehicles were operating perfunctorily. For the return routes to HCMC, his trucks must make the most of their loads to carry all kinds of goods to cover costs partially. Meanwhile, costs have incurred a lot due to continuous hikes in petrol prices and the Covid-19 testing costs for drivers.

Mr. Tran Thanh My, the owner of My Tu Company, specializing in supplying building materials, said that most large construction projects have only operated moderately. Many projects even have not been deployed again, so many enterprises that specialize in providing construction materials and leveling have almost been standing still.

“In addition, the pandemic has not been over yet, and gasoline prices have continuously escalated, so businesses have been facing many difficulties in the past few months,” said Mr. My.

Similarly, Nguyen Anh Tuan, owner of a company that transports agricultural products by container trucks on the North-South route, said that with a revenue of more than VND40 million per trip, the cost of oil is more than VND17 million, accounting for up to 36 percent. Freight rates should be raised by about 20 percent to balance revenue. However, the company is in a difficult position for signed contracts because customers hardly accept a change in freight charges at the moment.

Vice-Chairman of the Vietnam Automobile Transportation Association Ho Van Huong said that fuel costs accounted for 35-40 percent of transportation costs. Currently, the number of vehicles resumed operations is only 15 percent because of a decrease in the number of passengers. There are only a few passengers while gasoline prices climb. As a result, the more vehicles operate, the more losses they will suffer.

The recent sharp increase in gasoline prices has been directly affecting raw materials for the production of enterprises, such as packaging, transportation costs, and animal feed. Ms. Pham Thi Huan, General Director of Ba Huan Company, said that the average price of input raw materials has risen by about 30 percent compared to the previous one, whereas the selling prices of poultry eggs and other processed foods on the market remain unchanged.

The company does not increase its selling prices at this moment because the market has just undergone a prolonged social distancing, and the income of consumers has decreased, leading to weak purchasing power. To boost demand, the company even has to continuously launch promotions and discounts on poultry egg products, so price increases will not happen in the near future.

To keep the current price, the company must accept to reduce profits, even partially make up for losses. Therefore, in the long term, to support businesses, representatives of many companies proposed policies to stabilize market prices, as well as policies to create consumer demand, thereby creating leverage for businesses to promote consumption in large quantities, contributing to reducing losses, gradually recovering, and developing.

According to Dr. Dinh The Hien, an economic and financial expert, currently, commodity prices have surged because transportation activities connecting production with distribution have not actually recovered yet. However, the current increase in gasoline prices will also have a certain impact on the rise in commodity prices. In the long term, for the consumer goods prices not to hike sharply, Vietnam must promote the market economy, fight against monopolies or group interests so that there is no price manipulation.

According to economic experts, there are two tools to control gasoline prices, namely the Fuel Price Stabilization Fund and taxes. If these two policies are used properly, the rate of increase in gasoline prices will be cut, especially when the ratio of taxes and fees in gasoline prices is more than 40 percent. The State can support enterprises by reducing or exempting environmental protection tax collected through petroleum products.

Vietnam should introduce appropriate economic support policies: experts
 
The socio-economic recovery and development program is still in the preparation stage to be submitted to the Government this December. It has attracted much attention of delegates in the second session of the 15th National Assembly regarding possible impacts on the macro economy like increasing spending, public debt, government debt, and inflation risks.

Minister of Planning and Investment Nguyen Chi Dung mentioned the national mission of entering the list of upper-middle income countries after 10-15 years via taking full advantage of all possible opportunities created by Industry 4.0, signed free trade agreements, and the golden population structure.

Delegate Nguyen Ngoc Son from Hai Duong Province voice his opinion that despite the public debt ceiling and deadlines of due debts compared to the total annual budget revenues, the room of the fiscal policy is still larger than the one of the monetary policy when coping with the pressure of increasing debt and inflation control. He, therefore, thought that it is possible to rise budget deficit for the next two years higher than the current 4 percent of GDP in order to financially support businesses.

Dr. Tran Van Luc from BIDV Bank informed that the rate of global budget deficit has grown by 7 percent from 3.2 percent lately. Hence, he suggested that Vietnam should approve a non-cyclical ease like above to create more jobs and increase the national economic scale and GDP for development. This, in turn, will automatically help reduce budget deficit and public debt. Then comes the road map to fiscal consolidation and macro economy.

Chairman of the National Assembly Vuong Dinh Hue concerned that besides a correct evaluation the current economic status of the nation in order to devise a feasible recovery program, it is necessary to take into account the economy’s ability to absorb capital so as to accelerate the disbursement process. This worry of slow disbursement is shared by Minister Dung.

Former President of Vietnam Chamber of Commerce and Industry Vu Tien Loc raised his concern regarding support packages related to public investment that the disbursement acceleration at all costs might lead to capital investment flowing into inefficient projects. To avoid that, this investment should focus on key national projects under strict monitoring of the National Assembly.

He added at administrative procedures should be simplified to boost public investment, while the public-private partnership model should be wider promoted to mobilize resources in the community on the basis of ensuring interest harmony. It is unwise to push all risks and difficulties to the public and private businesses.

Former Head of the Central Institute for Economic Management of Vietnam Nguyen Dinh Cung stated that it is essential to introduce the three requirements for this socio-economic recovery and development program: detailed, clear, comprehensible, feasible solutions; consistent implementation; and proper evaluation, checking. Along with that is a reform in implementation methods without too much dependence on traditional administrative procedures and administrative approval process.

He suggested that this program should be done in 3 years from 2022, with the general goal of quickly recovering and accelerating the GDP increase speed. Most importantly, the Government should try to gain a consensus from the whole community to finish this economic recovery program.

Chairman of Ho Chi Minh City Passenger Transport Association Le Trung Tinh said that goods flow must be maintained in all situations, which means proper support to transportation enterprises, especially when fuel prices witness a rise yet the transport demands among the public or goods is not too high. He proposed that the Government should postpone certain regulations that ask for business budget to save resources for restarting their operation.

Dr. Pham Tran Hai from the HCMC Institute for Development Studies shared that governments and international sponsoring organizations usually use the Cost – Benefit Analysis tool (CBA) to evaluate the necessity and priority level of an investment project to the society. Vietnam should consider this tool to select public investment projects that are leveraged and pervasive to boost socio-economic growth effectively.

Digital signature increasingly popular in Vietnam
 
A digital signature is commonly used in online procedures such as tax declaration and payment, customs e-declaration, e-banking, national one-stop portal for administrative services. Thanks to recently introduced legal documents in Vietnam related to e-commerce, digital signature has been used more and more by various businesses.

Deputy Director of the National Electronic Authentication Center Nguyen Thien Nghia informed that there are 18 units nationwide approved to offer the digital signature service.

Lately, Bkav has become one of them, certified by the Ministry of Information and Communication, after meeting all criteria in the evaluation criteria set for policies on management, operation, exploitation and provision of services for remote digital signing. This is the new version of digital signature and can be used widely even on mobile devices with authentication of signers and full support for advanced authentication mechanism like fingerprint and face recognition.

Before this, the Information and Communication Ministry has also approved Vietnam Post and Telecommunications Group (VNPT) as a provider of this service. Understanding the high demand of digital signatures and the remote digital signing model, especially during the Covid-19 pandemic, where people have to work from home, VNPT has introduced its solution named SmartCA to ensure the safety and convenience of transactions for its clients.

Even after the outbreak is under control, the use of digital signature in online transactions maintains at a high level, as the digitalization speed is greater each day.

Similar to VNPT, MISA JSC is offering its remote digital signing service called eSign with a high security level via the 2-factor authentication mechanism. Its clients can use the digital signature for e-bill issuing, tax and social insurance declaration, customs declaration on their mobile devices.

Formerly, the use of a digital signature depended largely on physical equipment like USB token. However, thanks to advanced technologies, access to a digital signature becomes more flexible via all kinds of smart devices such as smartphones, laptops, or tablets, while still maintaining security, legality.

With so many service providers in Vietnam now, it is advisable to consider the two aspects of service fee and customer service.

To increase competitiveness, qualified agencies normally offer a price much lower than the formal one by the head office, along with various promotions. Nevertheless, to enjoy these advantages, businesses have to pay for extra services like installation or initialization. Therefore, customers need to investigate the total fee they pay and even service renewal fee, not just the basic one.

After-sale customer service like problem handling is also an important matter to consider.

Statistics reveal that the average price offered by leading technology companies such as Viettel, VNPT, FPT, Bkav, CMC is around VND1-1.5 million (approx. US$44-66) per year.

Since digital signatures are becoming increasingly popular in daily life and the foundation for future applications, Deputy Director Nghia hoped that service providers closely collaborate with the Government Cipher Committee, the Public Security Ministry to launch and better managed the digital signature market.

Trungnam puts 46-MW wind farm into operation

The Trungnam Group has inaugurated a 46.2 MW wind farm in Ninh Phuoc District of Ninh Thuan Province. The project has 11 turbines able to generate an annual output of over 136,000 MWh.

The inauguration of the VND1.6 trillion wind power plant marks a milestone in the Trungnam Group’s campaign to complete 200 MW of wind power and 650 MW of solar power in this south-central coastal province. It paved the way for Ninh Thuan to step closer to its target of becoming a renewable energy center in the country, reported Thanh Nien newspaper.

At the inauguration ceremony, the Trungnam Group presented 10 homes to low-income families in the district, with total funding of over VND500 million.

Trungnam this year has completed three major wind power projects. Of them, the Ea Nam wind power project in the Central Highlands province of Daklak has become the largest onshore wind power project in Vietnam with a capacity of 400 MW, while the 100-MW Dong Hai 1 Tra Vinh project remained the largest offshore wind power plant in the country.

Vietnam sees auto imports rebound

Vietnam imported 15,360 completely built-up (CBU) cars worth some US$350 million in October, surging by over 77% in both volume and value over the previous month, according to the latest statistics from the General Department of Vietnam Customs.

The October auto import was equivalent to the figures seen in March, April and May at over 15,000 units each month, while Vietnam bought just 8,700 cars in September when the country was hit hard by the Covid pandemic.

Despite the impact of the pandemic, Vietnam’s CBU imports soared in the past 10 months. Between January and October, the country spent US$2.9 billion importing some 130,000 units, up 61.6% in volume and 63.9% in value year-on-year.

Vietnam’s three leading car suppliers were still Thailand, Indonesia and China. Thailand shipped some 65,600 cars to Vietnam during the 10-month period, jumping by 68% year-on-year, while over 37,900 cars and 16,300 autos were imported from Indonesia and China, up 31% and 222%, respectively, over the same period last year.

Data from the Vietnam Automobile Manufacturers Association (VAMA) indicated that the hike in the consumption of imported CBU cars was much higher than that of locally produced and assembled autos. In September, the number of locally-assembled autos sold was over 7,310, rising by 37% month-on-month, while the number of imported CBU cars sold was over 6,220, surging by 76%.

In the January-September period, sales of locally-assembled cars inched down 6% year-on-year, while the consumption of imported vehicles rose by 26%.

The Ministry of Finance is garnering feedback on a draft decree to halve the registration fee for locally assembled or manufactured cars within six months. If approved by the Government, the 50% cut in the registration fee for these cars will boost local auto assemblers.

Dong Nai needs over 50,000 workers by end-2021 to restore production

Businesses operating in the southern province of Dong Nai will be recruiting over 50,000 workers from now until the end of the year to facilitate the recovery of production, according to the provincial Employment Services Center’s forecast.

The province is home to more than 1,700 businesses in industrial zones, with over 615,000 workers in total. To date, nearly 100% of companies in industrial parks have resumed operations and need a large number of workers, according to the Dong Nai Industrial Zones Authority.

The center added that when companies reopened last month, they had started recruiting over 30,000 workers but many of them could not hire enough workers. Accordingly, from this month, they continued to offer incentives to attract more workers, especially incentives in terms of salaries, bonuses and other welfare regimes for old employees to return to work or new recruits. They will also provide support in terms of house rentals, raise attendance money and offer training to help employees quickly adapt to their jobs.

Besides this, major companies in the leather-footwear industry are recruiting an unlimited number of workers and offering various incentives.

Le Nhat Truong, president of the labor union of Pousung Vietnam, which is located in the Bau Xeo Industrial Park in Trang Bom District, said the company is offering a VND800,000-VND1-million reward to any worker that could introduce new workers to its factory and a VND1.8-2.1 million reward to new recruits depending on their skills, reported Lao Dong newspaper.

The Taekwang Vina Company in the Bien Hoa 2 Industrial Park in Bien Hoa City is recruiting 3,000-4,000 workers and supporting each worker from the Central Highlands province of Daklak to Dong Nai to work with an amount of VND2.3 million in 12 months. It will also offer VND200,000 to each person in one year if he/she applies to the firm, in addition to other allowances.

To support businesses in the province, labor unions at all levels are working with other localities to announce the welfare policies of Dong Nai in an attempt to attract more workers, as well as review the demand for workers at each company and help connect more applicants. Labor unions of companies were also told to negotiate with employers to offer more employment incentives to ensure the provision of appropriate jobs, incomes and the safety of employees.

Further, the provincial government has also made arrangements to transport workers from other localities back to Dong Nai as well as vaccinate them against Covid.

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

Source: https://vietnamnet.vn/en/business/vietnam-business-news-november-16-792517.html

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Magnetic strip ATM cards to remain valid next year

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A customer uses a chip card for payment at a point-of-sale (POS). VNA/ Photo

HÀ NỘI — The State Bank of Vietnam (SBV) this week issued a dispatch, noting that domestic automated teller machine (ATM) cards with magnetic strips will remain valid for normal use after December 31, 2021.

The dispatch was issued after some banks have recently started sending notices to their customers about stopping supporting cards from ATMs to meet the deadline of the SBV’s Circular 19/2016 on the roadmap to convert from issuing magnetic strip cards to chip cards from next year.

Under the new dispatch, the SBV clarified that Circular 19/2016 makes no mention of a suspension of transactions using magnetic strip cards that remain valid.

December 31 this year is the deadline for changing to chip cards, not the date that magnetic strip cards will become invalid, the SBV noted, adding customers can continue to use magnetic strip ATM cards for transactions at ATMs, point-of-sale (POS) and bank counters, and for internet and mobile banking services after December 31 this year.

Under the new dispatch, the SBV asked card issuers and card payment organisations to ensure card holders’ transactions are carried out smoothly, safely and do not affect the interests of cardholders. They were also asked not to issue policies and regulations that go against the law on bank card operations.

In addition, they were told to launch media campaigns to inform their customers that magnetic stripe cards can still be used after December 31 this year.

However, under the new dispatch, the SBV also asked card issuers to encourage and support their customers to convert magnetic cards to chip cards to enhance security and to warn them of the risks if magnetic cards continue to be used.

There are two common ways to convert magnetic cards to chip cards.

In the first way, customers only need to bring valid citizen ID card or passport to the bank’s transaction point and request to convert from magnetic card to chip card.

In the second way, customers can access digital banking applications and mobile banking to apply for and receive cards at home or at the bank’s transaction points.

Or at some banks, the process is even more convenient. For example, at TPBank, customers can exchange magnetic cards for chip cards at LiveBank 24/7 and receive cards in just a few minutes.

In order to encourage customers to change magnetic strip cards to chip cards, most banks offered this service free of charge and the change is still free at some banks.

For example, at NamABank, the bank will completely convert magnetic strip cards to VIP cards for free from now until December 31, 2021. Similarly, Techcombank is also offering this activity free of charge.

According to experts, the conversion of magnetic strip cards to chip cards is beneficial for users, contributing to improving the security level, transaction speed, safety and ensuring the interests of customers.

Specifically, a magnetic card is a card containing a magnetic strip storing customer’s encrypted information. The data is permanently stored on the magnetic strip and is encrypted only once, so it easily leads to the risk of card information theft and transaction fraud.

Meanwhile, chip cards, which are also known as “smart cards”, have a microchip attached to the surface of the card, and this is the basic difference between chip cards and magnetic strip cards. For chip cards, transaction data includes data stored on the chip and the transaction password that changes with each transaction. Specifically, every time a chip card is used for payment, the chip will generate a unique transaction code and never repeat. In case the customer’s card is stolen from a certain store, the fake card will never work because the stolen transaction code will not be reused, the card will be rejected. —      


 

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Source: https://vietnamnews.vn/economy/1092063/magnetic-strip-atm-cards-to-remain-valid-next-year.html

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Exporters told to strictly comply with EU regulations to avoid losses

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The European Union has a large demand for imported agricultural products and, thanks to the EU-Vietnam Free Trade Agreement (EVFTA), Vietnamese businesses have a unique opportunity to take advantage of this.

 However, local businesses need to strictly comply with European regulations to avoid losses when exporting to the region.

Exporters told to strictly comply with EU regulations to avoid losses
The EU applies strict requirements and regulations on imported food products. — VNA/VNS Photo Vu Sinh 

For food products, the EU has strict requirements and regulations on product quality and the maximum residue level (MRL) of pesticides.

Trade counsellor Tran Ngoc Quan, head of the Vietnam Trade Office in Belgium and EU, said that most regulations across the bloc are similar when it comes to agricultural and food products.

Germany, Austria, the UK, Netherlands and Belgium do have stricter and higher MRL levels than the standard EU regulations, though these vary with different active ingredients, fresh produce and processed products.

Dang Phuc Nguyen, General Secretary of the Vietnam Fruit and Vegetable Association, said that while Vietnamese fruits and vegetables are more competitive than those from countries without a European trade agreement, exporters must focus on improving MRL levels.

Nguyen said: “If enterprises exporting to the EU do not comply with the regulations, they face the risk of increased levels of inspections, supervision and perhaps even being banned from exporting to these markets in the future.

“The EU applies these regulations very strictly. Enterprises that want to export to the EU must obtain certificates and production levels according to GlobalGAP.”

Nguyen added that violators run the risk of incurring heavy losses if they are caught.

According to the new EU regulation No 2021/1900, effective from November 23, the frequency of pesticide testing on Vietnamese herbs and fruits will increase. Of this, 50 per cent of testing will be applied to coriander, basil, mint, parsley, beans corn and pepper and 10 per cent will be applied to dragon fruit.

Nguyen said that as vegetable products in Vietnam often have pesticides, some samples and consignments will be tested for residue. The EU has also increased the frequency of testing, adding that the more enterprises violate the regulations, the more frequent inspections will be. 

He said bans on export to the EU could be applied to violators.

According to a representative of the Vietnam Pepper Association (VPA), the EU’s increase in testing will raise difficulties in exporting to the EU and will invite increased competition from other countries.

“In order to avoid violations, businesses must do better at testing products when exporting, as well as strengthening production links to create a clean and safe raw material area,” said a representative of VPA.

The EU also conducts post-inspections away from ports, so even though goods are being consumed or sold at supermarkets or shops, if they are not of good quality they can still be recalled, said Nguyen.

Using the example of a Vietnamese pepper export enterprise that was refused by Spain when its product was tested at the border gate recently, Nguyen said that if the violation was discovered when the product was already on shelves it would cause larger financial damage to the  Vietnamese exporter. 

Nguyen Minh Lien, General Director of Vinamex Company which purchases Vietnamese goods for export to the EU market, shared that some Vietnamese enterprises do not pay due attention to food safety issues. Lien added that due to the post-inspection of the EU market, some have had to pay fines and incur additional costs due to poor quality products.

In addition, Lien said some basic errors like incorrect packaging leads to products being returned or sold cheaper to other markets.

Lien noted when exporting goods to the EU, Vietnamese businesses must work closely with importers on product quality, packaging and contract inspection to avoid loss and damage.

She said supermarkets in the EU do not directly import goods from Vietnam, so local enterprises should cooperate with importers to arrange products at the warehouse before entering the retail market there.

She also suggested Vietnamese enterprises cooperate to diversify products, ensure sufficient output and take advantage of shared containers when exporting.

Considering EU customers are increasingly interested in buying products from businesses that contribute to community development and the environment, Nguyen said: “Sustainable development should be a long-term direction for export businesses in Vietnam.”

At the same time, even enterprises and manufacturers that follow the GlobalGAP requirements must pay attention to the plant protection ingredients that the EU bans or restricts, as some may be different from the GlobalGAP.

Source: Vietnam News

Source: https://vietnamnet.vn/en/business/local-exporters-must-strictly-comply-with-eu-regulations-to-avoid-losses-798131.html

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Moody’s upgrades VPBank’s rating to Ba3

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VPBank is one of the leading banks in Việt Nam. — Photo courtesy of the bank

HÀ NỘI — Global credit rating firm Moody’s Investors Services has upgraded Việt Nam Prosperity Bank (VPBank)’s foreign currency deposits from B1 to Ba3 which is equal to the country’s rating with positive outlook.

Moody’s BCA ratings reflect the independent intrinsic strength of the issuer. This credit rating is assessed based on the macro-environment, financial profile and qualitative assessment factors. In addition to upgrading the BCA rating, Moody’s also upgraded VPBank’s long-term local and foreign currency deposit ratings, rising to Ba3.

VPBank’s credit rating was announced after the bank completed the sale of a 49 per cent stake at its VPBank Finance Company Limited (FE Credit) to SMBC Consumer Finance Co Ltd (SMBCCF), a wholly-owned subsidiary of Japan’s Sumitomo Mitsui Financial Group, Inc (SMBC Group) at the end of October. Moody’s assessed that the capital sale brought about a significant improvement in the bank’s credit profile. Notably, according to Moody’s methodology, the bank’s capital adequacy ratio (CAR) increased from 11.4 per cent at the end of September 2021 to 13.5 per cent at the end of October 2021.

In addition to the improved capital base, the bank’s outstanding business results in recent months, despite the negative impact of COVID-19 on the economy, were also highly appreciated by Moody’s. The business results in the third quarter of the year showed that VPBank’s consolidated before-tax profit reached more than VNĐ11.7 trillion (US$513 million), up 24.9 per cent over the same period last year. The parent bank’s pre-tax profit alone reached VNĐ10.8 trillion, representing 75.2 per cent year-on-year increase. The bank’s total consolidated operating income reached VNĐ33.2 trillion, increasing 17.3 per cent over the corresponding period last year. Its consolidated return on assets (ROA) and return on equity (ROE) indices continued to be among the top of the market, reaching 2.8 per cent and 21.6 per cent respectively.

Moody’s believed that VPBank’s capital capacity will continue to be stable, as the bank has clearly demonstrated its plan to use capital obtained from the FE Credit deal to promote growth and seek new business investment opportunities. In addition, the assets scale will be further expanded thanks to the profit growth from business activities.

“VPBank’s asset quality and profitability will remain stable over the next 12-18 months,” Moody’s said in the announcement, emphasising the belief that VPBank’s asset quality will be well under control as Việt Nam’s economy recovers and vaccination rates increase.

The upgraded ratings from a prestigious international credit rating agency like Moody’s in the context that Việt Nam’s economy has suffered heavy impacts from the outbreak of the COVID-19 pandemic, has demonstrated confidence of international organisations in VPBank’s capital base and development plan this year and in the future. This also contributes to strengthening VPBank’s position, while further enhancing its ability to mobilise capital from reputable financial institutions. —

Source: https://vietnamnews.vn/economy/1092062/moodys-upgrades-vpbanks-rating-to-ba3.html

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