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Vietnam considers specific investment incentives to attract FDI

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Under the draft law, financial incentives would be given in three fields – corporate income tax, import/export tax; finance and land; and accelerated depreciation.

Investment incentives are one of the most important issues of the draft amended investment law being discussed by the National Assembly as Vietnam is competing with regional countries to attract new FDI from investors leaving China and seeking new destinations.

Vietnam considers specific investment incentives to attract FDI

Under the draft law, financial incentives would be given in three fields – corporate income tax, import/export tax; finance and land; and accelerated depreciation.

As Vietnam has become more selective in attracting FDI, the draft law shows the list of business fields in which Vietnam encourages investments.

Investment incentives are one of the most important issues of the draft amended investment law being discussed by the National Assembly as Vietnam is competing with regional countries to attract new FDI from investors leaving China and seeking new destinations.

These include high technologies; hi-tech supporting industry products; new material production, new clean renewable energy; electronics and key mechanical engineering, agricultural machines, automobiles and car parts; shipbuilding; IT and software; farm, forestry and seafood culture and processing; and waste treatment.

The business fields listed are in line with the investment encouragement policy stipulated in the Politburo’s Resolution No 50.

“These are the business fields that can create high added value. If they can develop thanks to investment incentives, this will help accelerate economic restructuring associated with the changes of the growth model towards sustainability, bringing higher income to the state budget,” said Vu Hong Thanh, chair of the National Assembly’s Economics Committee.

Regarding the incentives, some experts believe that Vietnam should only offer outstanding incentives to some special business fields, especially high technologies, while it should only give normal incentives to the fields popular in Vietnam.

Vu Thanh Tu Anh from the Fulbright School for Public Policy and Management stressed that the policies, the implementation of the policies and Vietnam’s preparation will determine the quantity and quality of the FDI flow that the economy can attract.

He warned that if Vietnam doesn’t have reasonable policies, it would only be able to attract the projects that do the outsourcing and use old technologies. If so, Vietnam won’t be able to escape the ‘outsourcing trap’ and this will aggravate the current structure and hinder efforts towards restructuring.

Nguyen Mai, chair of the Vietnam Association of Foreign Invested Enterprises (VAFIEs), said that Vietnam needs to attract high-quality, environmentally-friendly and high-tech projects as stipulated in the Politburo’s Resolution No 50.

According to Hirai Shinji, chief representative of JETRO in HCM City, before the Covid-19 epidemic broke out, Vietnam was one of the three choices for Japanese investors.

The additional investment capital registered by Japanese investors in Vietnam saw the sharpest increases among existing foreign investors in Vietnam, above Chinese and Japanese.

Shinji said though it is still too early to assess the changes before and after the epidemic, Vietnam is still the top choice of Japanese enterprises.

Linh Ha 

Source: https://vietnamnet.vn/en/business/na-deputies-propose-more-investment-incentives-648329.html

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Ho Chi Minh City police search Home Credit, debt trading company

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Police in Thu Duc City under Ho Chi Minh City raided the headquarters of Galaxy Debt Trading Company and Home Credit Vietnam, a consumer finance provider, over extortion and asset appropriation allegations on Tuesday.

Hundreds of police officers inspected the office of Galaxy Debt Trading on the first and second floors of Linh Tay Tower in the namesake ward in Thu Duc City on Tuesday morning.

In front of the building, there were many traffic police officers, mobile police officers, and security guards.

Many police officers are seen at a building where Galaxy Debt Trading Company is headquartered.

Many police officers are seen at a building where Galaxy Debt Trading Company is headquartered in Ho Chi Minh City. Photo: Tuoi Tre

Inside the searched facilities, the firm’s employees were asked to stop working for the inspection.

The firm reportedly specializes in debt trading and financial services.

On the afternoon of the same day, police cordoned off the headquarters of Home Credit Vietnam Finance Company on Nguyen Dang Giai Street in Thu Duc City’s Thao Dien Ward for a search.

The firm, with hundreds of employees, is active in the personal financial field.

Mobile police officers are dispatched for a search.

Mobile police officers are dispatched for a search. Photo: Tuoi Tre

The Ministry of Public Security and police in many cities and provinces have recently cracked down on several illegal debt collection rings that misappropriated assets of debtors.

Investigation results showed that hundreds of thousands of people were threatened and terrorized for their late debt payments.

In mid-March, police in Tan Binh District, Ho Chi Minh City prosecuted 14 debt collectors over asset appropriation related to Vietnam Thinh Vuong Debt Trading JSC and THT Law Company.

Besides, Ho Chi Minh City police have launched criminal proceedings against 26 individuals who are employees at Mirae Asset Finance Company and Power Law Company over calumny.

Police officers conduct an inspection at the headquarters of Home Credit Vietnam in Thu Duc City. Photo: Minh Hoa/ Tuoi Tre

Police officers conduct an inspection at the headquarters of Home Credit Vietnam in Thu Duc City, Ho Chi Minh City. Photo: Minh Hoa / Tuoi Tre

A photo of police cars that transported police officers to Linh Tay Tower for a search. Photo: Hao Dang/ Tuoi Tre

A photo of police cars that transported police officers to Linh Tay Tower for a search on March 28, 2023. Photo: Hao Dang / Tuoi Tre

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Police in Thu Duc City under Ho Chi Minh City raided the headquarters of Galaxy Debt Trading Company and Home Credit Vietnam, a consumer finance provider, over extortion and asset appropriation allegations on Tuesday.

Hundreds of police officers inspected the office of Galaxy Debt Trading on the first and second floors of Linh Tay Tower in the namesake ward in Thu Duc City on Tuesday morning.

In front of the building, there were many traffic police officers, mobile police officers, and security guards.

Many police officers are seen at a building where Galaxy Debt Trading Company is headquartered.

Many police officers are seen at a building where Galaxy Debt Trading Company is headquartered in Ho Chi Minh City. Photo: Tuoi Tre

Inside the searched facilities, the firm’s employees were asked to stop working for the inspection.

The firm reportedly specializes in debt trading and financial services.

On the afternoon of the same day, police cordoned off the headquarters of Home Credit Vietnam Finance Company on Nguyen Dang Giai Street in Thu Duc City’s Thao Dien Ward for a search.

The firm, with hundreds of employees, is active in the personal financial field.

Mobile police officers are dispatched for a search.

Mobile police officers are dispatched for a search. Photo: Tuoi Tre

The Ministry of Public Security and police in many cities and provinces have recently cracked down on several illegal debt collection rings that misappropriated assets of debtors.

Investigation results showed that hundreds of thousands of people were threatened and terrorized for their late debt payments.

In mid-March, police in Tan Binh District, Ho Chi Minh City prosecuted 14 debt collectors over asset appropriation related to Vietnam Thinh Vuong Debt Trading JSC and THT Law Company.

Besides, Ho Chi Minh City police have launched criminal proceedings against 26 individuals who are employees at Mirae Asset Finance Company and Power Law Company over calumny.

Police officers conduct an inspection at the headquarters of Home Credit Vietnam in Thu Duc City. Photo: Minh Hoa/ Tuoi Tre

Police officers conduct an inspection at the headquarters of Home Credit Vietnam in Thu Duc City, Ho Chi Minh City. Photo: Minh Hoa / Tuoi Tre

A photo of police cars that transported police officers to Linh Tay Tower for a search. Photo: Hao Dang/ Tuoi Tre

A photo of police cars that transported police officers to Linh Tay Tower for a search on March 28, 2023. Photo: Hao Dang / Tuoi Tre

Like us on Facebook or  follow us on Twitter to get the latest news about Vietnam! 

Source: https://tuoitrenews.vn/news/business/20230328/ho-chi-minh-city-police-search-home-credit-debt-trading-company/72315.html

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Vietnam’s VPBank announces agreement to issue 15% of its charter capital to Japan’s SMBC

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Vietnam Prosperity Joint Stock Commercial Bank (VPBank) on Monday announced that it has entered into an agreement with Japan’s Sumitomo Mitsui Banking Corporation (SMBC) – a subsidiary of Sumitomo Mitsui Financial Group, Inc. (SMFG) – to issue 15 percent of equity stake through a private placement, officially welcoming SMBC as a foreign strategic investor of the bank.

The investment from SMBC will help the bank raise VND35.9 trillion, or approximately US$1.5 billion, of Tier 1 capital, increasing its owner equity to around VND140 trillion from VND103.5 trillion.

This comes as part of the capital raising plan that VPBank has been implementing during 2022-23 in order to enhance its long-term financial strength and support the bank to reach ambitious growth strategy over the next five years.

Following the latest SMBC’s strategic investment, VPBank will become Vietnam’s second largest bank in terms of owner equity, which allows it to serve a wide range of customer needs in various segments, including retail banking, corporate banking and small and medium-sized enterprises (SMEs).

The robust capital stance will also back VPBank in serving large-scale enterprises, particularly the foreign direct investment (FDI) and multi-national companies that have been or will be investing in Vietnam. 

The new investment also proves a strong and trusted collaboration between SMBC and VPBank, since the two parties entered into a business partnership agreement in May 2022.

Previously, in 2021, SMBC Consumer Finance Co., Ltd – a subsidiary of SMFG – also acquired a 49 percent of equity stake in FE Credit, a wholly-owned subsidiary of VPBank.

SMBC, through this investment, will contribute towards VPBank’s growth by leveraging its know-how and business expertise accumulated in other Asian markets. SMBC is thus expected to help accelerate the digital transformation at VPBank, in order to deliver customer-centric banking products and services and superior customer experience.

Furthermore, thanks to the great reputation of a large financial institution like SMBC, the strategic deal is anticipated to attract and encourage potential FDI companies among the 200,000 corporate clients of SMBC to come and expand their investment in Vietnam.

These potential enterprises, once enter Vietnam successfully, will also likely become clients of VPBank.

For SMBC itself, through the rapport built with a local bank like VPBank, the group will be able to strengthen its foothold in the country and exploit opportunity to serve local investment projects, particularly those in the field of infrastructure construction and green and sustainable growth that the group has been paying attention to in recent years.

As one of the earliest-established joint-stock commercial banks in Vietnam, VPBank has achieved sustainable development throughout its 30-year history.

VPBank is now the leading commercial bank in Vietnam in terms of efficiency and profitability, with strong presence in retail and SME segments. It is also the digital pioneer implementing end-to-end digitization to deliver distinctive customer value propositions. As of December 31, 2022, VPBank’s total assets amounted to approximately $27 billion, with a network of 251 branches national wide.

VPBank is also among the best-capitalized banks with CAR at approximately 15 percent, well beyond the regulatory requirement, which has strengthened its balance sheet and provides headroom for future growth. 

For more information, please visit https://www.vpbank.com.vn

Sumitomo Mitsui Banking Corporation (SMBC) is one of the largest commercial banks in Japan. With offices in 39 countries and regions including the Americas, Europe, the Middle East, Africa, Asia and Oceania, SMBC has an extensive global network and growing international presence.

SMBC and its group companies offer a broad range of financial services, including deposit taking, lending, securities brokering and trading, securities investment, money transfer, foreign currency exchange, corporate bond trustee services and custody services, financial futures underwriting, investment trust sales and other commercial banking activities.

SMBC is rated “A” by Fitch Ratings, “A” by Standard & Poor’s Global, and “A1” by Moody’s.

For more information, please visit https://www.smbc.co.jp/global

Like us on Facebook or  follow us on Twitter to get the latest news about Vietnam!

Vietnam Prosperity Joint Stock Commercial Bank (VPBank) on Monday announced that it has entered into an agreement with Japan’s Sumitomo Mitsui Banking Corporation (SMBC) – a subsidiary of Sumitomo Mitsui Financial Group, Inc. (SMFG) – to issue 15 percent of equity stake through a private placement, officially welcoming SMBC as a foreign strategic investor of the bank.

The investment from SMBC will help the bank raise VND35.9 trillion, or approximately US$1.5 billion, of Tier 1 capital, increasing its owner equity to around VND140 trillion from VND103.5 trillion.

This comes as part of the capital raising plan that VPBank has been implementing during 2022-23 in order to enhance its long-term financial strength and support the bank to reach ambitious growth strategy over the next five years.

Following the latest SMBC’s strategic investment, VPBank will become Vietnam’s second largest bank in terms of owner equity, which allows it to serve a wide range of customer needs in various segments, including retail banking, corporate banking and small and medium-sized enterprises (SMEs).

The robust capital stance will also back VPBank in serving large-scale enterprises, particularly the foreign direct investment (FDI) and multi-national companies that have been or will be investing in Vietnam. 

The new investment also proves a strong and trusted collaboration between SMBC and VPBank, since the two parties entered into a business partnership agreement in May 2022.

Previously, in 2021, SMBC Consumer Finance Co., Ltd – a subsidiary of SMFG – also acquired a 49 percent of equity stake in FE Credit, a wholly-owned subsidiary of VPBank.

SMBC, through this investment, will contribute towards VPBank’s growth by leveraging its know-how and business expertise accumulated in other Asian markets. SMBC is thus expected to help accelerate the digital transformation at VPBank, in order to deliver customer-centric banking products and services and superior customer experience.

Furthermore, thanks to the great reputation of a large financial institution like SMBC, the strategic deal is anticipated to attract and encourage potential FDI companies among the 200,000 corporate clients of SMBC to come and expand their investment in Vietnam.

These potential enterprises, once enter Vietnam successfully, will also likely become clients of VPBank.

For SMBC itself, through the rapport built with a local bank like VPBank, the group will be able to strengthen its foothold in the country and exploit opportunity to serve local investment projects, particularly those in the field of infrastructure construction and green and sustainable growth that the group has been paying attention to in recent years.

As one of the earliest-established joint-stock commercial banks in Vietnam, VPBank has achieved sustainable development throughout its 30-year history.

VPBank is now the leading commercial bank in Vietnam in terms of efficiency and profitability, with strong presence in retail and SME segments. It is also the digital pioneer implementing end-to-end digitization to deliver distinctive customer value propositions. As of December 31, 2022, VPBank’s total assets amounted to approximately $27 billion, with a network of 251 branches national wide.

VPBank is also among the best-capitalized banks with CAR at approximately 15 percent, well beyond the regulatory requirement, which has strengthened its balance sheet and provides headroom for future growth. 

For more information, please visit https://www.vpbank.com.vn

Sumitomo Mitsui Banking Corporation (SMBC) is one of the largest commercial banks in Japan. With offices in 39 countries and regions including the Americas, Europe, the Middle East, Africa, Asia and Oceania, SMBC has an extensive global network and growing international presence.

SMBC and its group companies offer a broad range of financial services, including deposit taking, lending, securities brokering and trading, securities investment, money transfer, foreign currency exchange, corporate bond trustee services and custody services, financial futures underwriting, investment trust sales and other commercial banking activities.

SMBC is rated “A” by Fitch Ratings, “A” by Standard & Poor’s Global, and “A1” by Moody’s.

For more information, please visit https://www.smbc.co.jp/global

Like us on Facebook or  follow us on Twitter to get the latest news about Vietnam!

Source: https://tuoitrenews.vn/news/business/20230328/vietnams-vpbank-announces-agreement-to-issue-15-of-its-charter-capital-to-japans-smbc/72312.html

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How tea chain Phuc Long fared in the year after Masan takeover

Beverage chain Phuc Long Heritage, in which conglomerate Masan Group owns 85%, reported the second highest revenues in the bubble tea and coffee industry last year.

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Its revenues were VND1.579 trillion ($67.15 million) and earnings before interest, taxes, depreciation, and amortization (EBITDA) were VND195 billion, the highest gross profit margin in the industry, according to Masan’s newly published annual report.

Highland Coffee had revenues of over VND2 trillion a year in 2019 and 2020.

Phuc Long opened 23 large flagship stores and two mini shops in the last quarter of 2022, increasing their total numbers to 111 and 21.

They represented a near doubling of numbers from 2021 when Masan first bought stakes in Phuc Long.

The flagship stores achieved very high profit margins of 31% in 2022 and 26% in 2021. Last year they reported sales of VND1.1 trillion and profits of VND330 billion.

But Phuc Long had to close 150 tea and coffee kiosks located inside WinMart retail stores, also belonging to Masan, in the second half of 2022, the annual report said.

“We are adjusting this model (opening tea and coffee kiosks in WinMart stores) in the first half of 2023 before continuing to expand scale.”

In the event Phuc Long failed to achieve its target of opening 1,000 new kiosks last year.

But Phuc Long’s profit, of VND195 billion, was lower than the profit from its flagship stores alone, which meant the kiosks were losing money, the reason for the rejig of the model, according to experts.

Last year it accounted for 2% of Masan’s revenues and up 1.3% of profits.

It targets revenues of VND2.5-3 trillion this year, up 58-90% from 2022, mainly thanks to the opening of some 90 new stores.

Masan first bought shares of Phuc Long in May 2021, paying $15 million for a 20% stake. Last year it bought 70% in two different transactions for VND6.1 trillion.

Masan hopes to make Phuc Long the top tea and coffee chain in Vietnam over the next few years before going overseas in 2024 or 2025.

Source: VnExpress

Source: https://e.nhipcaudautu.vn/companies/how-tea-chain-phuc-long-fared-in-the-year-after-masan-takeover-3351560/

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