Taking full advantage of opportunities from CPTPP
One year after its coming into force, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has initially brought about positive effects for foreign trade activities; however, many opportunities from the agreement have not been fully explored.
Export growth not matching the potential
Vietnam has completed customs clearance procedures for seven tonnes of frozen durian into the New South Wales state of Australia, beginning the fruit’s journey to conquer consumers in one of the most fastidious markets in the world. This batch of durian was imported by the ASEAN Company, headquartered in New South Wales.
Nguyen Phu Hoa, Head of the Vietnam Trade Office in Australia, said that although Australia has not yet granted permission for the import of fresh durian, frozen durian has become a popular product in the country. In order to promote and boost the consumption of a typical Vietnamese product such as this, the Vietnam Trade Office in Australia has coordinated with the ASEAN Company to hold Vietnamese Durian Week, gathering many Asian people from July 20-31.
To further enhance the opportunity for the Vietnamese durian to penetrate the Australian market, the Vietnam Trade Office has promoted the organisation of Vietnamese Durian Week with an attractive programme, during which customers buying durian will have the chance to win luxury Vietnamese agricultural products. The promotion campaign aims to introduce a variety of Vietnam’s high-quality agricultural products to the Australian market, thus opening up market opportunities for the country’s products across different strengths. Following Durian Week, the Vietnam Trade Office will continue to work with several import agencies in Perth City ,Western Australia state, to launch a promotional programme for several batches of Vietnamese durian branded AAA, which ire expected to arrive in the state early next month.
The event is one of the trade promotional programmes aiming to bring Vietnamese products into Australia, one of the greatest potential markets under the CPTPP. More than a year since its coming into effect, the CPTPP created about encouraging initial results and has contributed to increasing the country’s export turnover.
According to the Ministry of Industry and Trade (MoIT), exports to CPTPP member countries witnessed positive growth in the first half of 2020, such as exports to Australia having increased by 2.3%, to Chile by 1.6% and to Mexico by 1.6%. Although the growth rate was not too high, this result is considered to be a cause for optimism in the context of the Covid-19 pandemic affecting the export turnover of goods.
Director of the MoIT’s Multilateral Trade Policy Department Ngo Chung Khanh affirmed that the positive result of foreign trade activities with CPTPP member countries was the impact of overall reform. The CPTPP contains many contents related to reform requirements.
In 2019, Vietnam’s export turnover to CPTPP member markets recorded good growth, especially exports to the Canadian and Mexican markets, who do not have free trade agreements with Vietnam, increasing sharply by 26%-29%. In previous years, Vietnam’s trade deficit with the soon to be CPTPP bloc was US$0.9 billion per year; however, in the first year of the CPTPP agreement taking effect, the country reported a trade surplus of US$1.6 billion to the bloc. The trade surplus result continued to be maintained in the first half of this year with exports to many markets such as Canada, Mexico and Peru.
Promoting market opportunities
There are still vast opportunities for increasing market share in the CPTPP, but in fact Vietnam has not yet taken full advantage of these. Ngo Chung Khanh cited that only 43/63 provinces and cities have established trade relations with CPTPP member countries. Especially, less than 10 localities have had trade relations with the Mexican and Canadian markets which have only recently signed free trade agreements with Vietnam.
State management agencies have proactively pursued the agreement’s benefits in recent times. Accordingly, 577 seminars and conferences on the CPTPP were held nationwide in 2019. That was a huge number; however, the number of enterprises exporting to Mexico and Canada is still modest.
“The CPTPP is the most complicated agreement that we have ever negotiated. Even several articles in the CPTPP are more complex than the Vietnam – EU Free Trade Agreement (EVFTA). Therefore, it will be a pity if the enterprises do not take full advantage of it”, said Khanh.
Le Tien Truong, General Director of the Vietnam National Textile and Garment Group (Vinatex), said that the yarn-forward rule of origin in the CPTPP has become the biggest challenge making the textile and garment sector not take full advantage of the agreement. So far, Vietnamese enterprises still import over 50% of raw materials. Meanwhile, the plans for the development of the sector and raw material area have been left open.
Accordingly, textile and garment enterprises need the support of the Government in raising the localisation rate of raw materials, especially stage of dyeing and weaving that is facing numerous difficulties as many localities have rejected dyeing projects due to concerns about environmental pollution.
Chairman of the Vietnam Chamber of Commerce and Industry (VCCI), Vu Tien Loc, noted that in addition to the communications of FTAs among enterprises, the Government should reform institutions and quickly legislate commitments to create favourable conditions for enterprises. The VCCI official also suggested that businesses should improve their governance, diversify markets and build risk prevention systems.
In fact, the opportunity to increase exports to CPTPP member countries is huge after Japan officially opened the door for Vietnamese lychees this year. In addition, the People’s Committee of Mai Son district (in Son La province) on June 22 coordinated with the provincial trade promotion centre to hold a ceremony to export 30 first tonnes of mango in the year to the US, Canada and Australia. Australian consumers have been familiar with Vietnamese mangoes in recent years; however, this is the first Vietnamese mangoe shipment exported to Canada which is considered a potentially major market of Vietnam in CPTPP bloc. Vietnam’s durians have also begun to conquer the Australian market. The above opportunities are expected to contribute to increasing the country’s export turnover to CPTPP member countries in the near future.
Taxing lucrative livestream businesses remains inadequate
|A 10,000-square-meter warehouse in Lao Cai City where a huge volume of fake, smuggled and low-quality goods set to be sold on Facebook is stored. The taxes collected from lucrative livestream businesses remains modest – PHOTO: TNO|
The number of online businesses operating on social media platforms and reporting huge sales may be on the rise, but the taxes collected from these businesses remains modest.
Tran Huu Linh, head of the Vietnam Directorate of Market Surveillance, at a review meeting on July 23 provided further information regarding a police raid conducted early this month on a 10,000-square-meter warehouse in Lao Cai City, where a huge volume of fake, smuggled and low-quality products meant to be sold on Facebook was being stored.
The market surveillance forces and police officers seized over 158,000 items of 237 products. Findings from the forces indicated that the warehouse owner employed over 70 staffers to operate the business mainly using Facebook Live to promote and sell the goods.
The sales staffers handled over 1,000 orders per day, with monthly retail sales exceeding VND10 billion. Moreover, the bank statement of the business provided by the bank’s side to the police revealed that its total revenue over the past two years reached more than VND649 billion.
The livestream method remains popular among online shops as it helps facilitate an interaction between sellers and buyers.
However, while online trading activities are commonplace, taxation agencies find it hard to collect a proper amount of taxes from these businesses.
Le Duy Minh, chief of the HCMC Tax Department, said shopping habits have changed a lot especially after the Covid-19 pandemic was brought under control in the country. Both sellers and buyers prefer online shopping as it is time-saving and economical.
The taxman can coordinate with banks to tax sellers based on their e-transactions. However, tax control over cash transactions is challenging.
To cope with the issue, the HCMC Tax Department has proposed cooperating with the General Department of Taxation to draw up plans to prevent tax losses, including those to monitor online shopping activities.
Vietnam gov’t to consider new power development plan later this year
The trade ministry is studying the Electricity Law to make clear the scope of investment of the state and the private sector in the energy industry.
Vietnam’s Ministry of Industry and Trade will submit the National Power Development Plan VIII and the National Energy Development Master Plan to Prime Minister Nguyen Xuan Phuc in October and by the end of 2020, respectively, Minister of Industry and Trade Tran Tuan Anh told the Vietnam Energy Summit 2020.
The ministry also continues to review and adjust power projects in the National Power Development Plan VII before the new plan is approved.
Plan VII was approved in 2011 and then adjusted in 2016 with the aim of reducing the porfolio of coal-sourced energy and increase the rate of renewables towards sustainable development.
The ministry also submitted the draft action plan of the government and expected the government to approve it this July. There are some issues that the ministry has to addressed in anticipation of the action plan, according to Minister Anh.
The minister affirmed that these plans would be foundational, creating a premise to promote the development of the national energy and electricity in the coming time.
At the same time, the important task is to accelerate the formulation of mechanisms and policies; the building of infrastructure to serve the development of the energy industry, environmental preservation, and the promotion of international cooperation in the industry, he added.
The government will continue to invest in sustainable energy infrastructure, enhance regional linkages; improve internal resources of the manufacturing industry and services for the energy sector by improving mechanisms, building databases and digital communication infrastructure.
In fact, the recent development of renewables showed that with the contribution of the private sector, Vietnam can achieve its goals in a much shorter time than expected.
In order to attract other economic players to participate in developing the energy sector, the ministry has submitted to the government and the National Assembly Standing Committee a number of provisions in some specialized laws for approval to create a transparent legal corridor.
It would stimulate the private sector invest more in different areas of the national energy system, especially in electricity development, Minister Anh said.
The trade ministry is reviewing and will propose to amend the Electricity Law to make clear the scope of investment of the state and the private sector in the energy industry, Anh said.
Trade ministry warns of fake Norwegian companies
The Ministry of Industry and Trade (MOIT) has warned Vietnamese enterprises of possible scams by foreign entities purporting to be companies from Norway.
The MOIT said the Norwegian police have reported 40 cases of scams, in which fraudsters created websites to mimic those of actual seafood exporters but with fake contacts.
Possible signs of fraud include exchanging information through WhatsApp or Skype, using bank accounts from outside Norway, using non-business email accounts such as Gmail, and providing VAT numbers with ten digits (Norwegian VAT numbers have nine digits).
The websites of fraudsters also do not have domains ending in .no nor do they have Norwegian language versions.
The Norwegian police have advised foreign companies to use video conferencing and record their communications while the MOIT recommends that Vietnamese companies verify the information carefully when planning to cooperate with Norwegian partners.
Italian, Korean businesses join hands to support Vietnamese firms
The Italian Chamber of Commerce in Vietnam and the Vietnam-Korea Business and Investment Association recently signed a memorandum of understanding to boost business connectivity between Vietnam, the Republic of Korea and Italy.
The signed MoU enables Vietnamese, Korean, and Italian businesses around the world to connect each other in order to enhance their partnership, seek investment and business opportunities at home and abroad, and assist Vietnamese firms in integration and development.
Addressing the signing ceremony, Italian Deputy Ambassador Paolo Epifani noted that Vietnam is a global potential market with almost 100 million consumers and the country has signed a number of new generation free trade agreements, opening up a wealth of opportunity for Italian and Korean businesses.
We will work hard to realize cooperation projects and programmes put forward by the Italian Chamber of Commerce in Vietnam (ICHARM) and the Vietnam-Korea Business and Investment Association (VKBIA), said the diplomat.
VKBIA President Tran Hai Linh said VKBIA, alongside offices in Vietnam and the RoK, has representative offices in Switzerland and many other countries in the world, helping bring into full play cooperation opportunities between Vietnam, the RoK and European countries.
Together with Korean and Italian investors, the Korean Chamber of Commerce in Vietnam (KOCHAM) and ICHAM will support and work toward building a global supply chain for businesses, Linh stressed.
He revealed that ICHAM and VKBIA will co-host an online forum in early August focusing on business connectivity in post coronavirus economic recovery.
Son La exports 30 tonnes of locally-grown longans to China
The northern mountainous province of Son La said it has just exported 30 tonnes of locally-grown longans to China, one of its farm produce consumers, opening the door for this kind of fruit to penetrate the huge lucrative market.
The news was unveiled at a July 25 conference to promote the export of agricultural products from Song Ma district in Son La province.
Song Ma district is home to the largest longan growing area in Son La province, covering a total area of over 7,500 hectares. This year, the district has distributed over 80 tonnes of longans bearing Song Ma brand to cities and provinces across the country.
Over the past few years Son La has strongly developed orchards, with several kinds of its fruit shipped abroad. The province has set a target of processing and exporting 75,000 tonnes of fresh fruits this year, including 8,500 tonnes to markets such as China, the United States, and Australia.
After successfully exporting mangoes to the UK and the UK this year, the province is set to ship red-flesh dragons to Japan, a very demanding market.
Lo Minh Hung, vice chairman of Son La province’s administration, stated that the locality will continue to introduce longan products at fairs held throughout the country to popularize the fruit. It will also provide support for businesses in processing and preserving the product to meet the consumer taste.
Despite the heavy impact of the novel coronavirus, the first six months of the year saw Son La actively boost domestic consumption and develop e-commerce platforms.
Maintaining production – a uphill task for garment sector
The garment sector is struggling to maintain production in the second half of the year as its export market is forecast to shrink by at least 30-40%, according to Le Tien Truong, General Director of the Vietnam National Textile and Garment Group (Vinatex).
Truong outlined that Vinatex’s total consolidated revenue in the past six months is estimated to decrease by 15% in comparison to the same period last year, while consolidated profits are projected to face a drop of 25%, although these falls are lower than previously forecast.
Despite this difficult time, the majority of Vinatex members made a profit, with the exception of fiber companies due to tensions between the United States and China.
Truong stated that Vinatex’s production facilities have yet to suffer a serious shortage of employment, largely due to growth in its sales of face masks and personal protective equipment (PPE).
However, the executive believed that moving forward into the final six months of the year, the garment sector will face a strong reduction in total export value as the demand for PPE has rapidly decreases. In addition, a large number of enterprises shifting to producing face masks and PPE in recent times has led to an excess supply of products that far outstrips demand.
According to Truong, the COVID-19 pandemic has yet to show signs of abating globally, and no one knows exactly when it comes to an end.
Many countries have begun to lift social distancing measures, not requiring their citizens to wear masks in public. Yet, the employment market has yet to recover, causing an impact on demand for consumer goods.
A number of studies show the average budget for garments and textiles among people remains very limited at present. This means people tighten their belt, which will affect the fashion market in the near future.
Moreover, the decline in demand is set to increase competition between garments firms, making the sector more intense.
In this context, Truong suggested that local enterprises should implement measures to make basic products for customers, while adopting flexible production methods, including accepting non-specialised production plans in the short term.
Domestic businesses should focus on cutting costs, improving competitiveness, and maintaining production during the difficult period, Truong said.
Squid, octopus exports slightly increase in June
Squid and octopus exports enjoyed a rise of 6.5% to US$48 million during June after previously suffering decreases for three consecutive months due to a low demand affected by the novel coronavirus (COVID-19) epidemic.
Statistics released by the Vietnam Association of Seafood Exporters and Producers (VASEP) indicate that squid and octopus exports fell by 16.9% on-year during the opening six months of the year to US$240 million.
Despite this drop, exports to many markets such as the Republic of Korea (RoK), ASEAN, China, and the United States witnessed growth in comparison to previous times.
The RoK is traditionally one the nation’s largest buyers of squid and octopus, accounting for 42.5% of total exports. Indeed, June alone saw exports to the RoK market increase by 23.5%, although due to sharp decreases witnessed in previous months, they suffered a decline of 15% to US$102 million during the first half of this year.
Elsewhere, Japan came second, making up 24.4% of total exports. Squid and octopus exports to the Japanese market reached US$58.6 million over six months, representing a drop of 21% compared to the same period last year.
According to the VASEP, as the COVID-19 is not completely under control around the world, the supply of raw seafood and global demand for processed seafood is set to continue to fall, simultaneously causing a decline in Vietnamese exports.
European firms more positive about Vietnam’s business climate
European businesses are more positive about Vietnam’s trade and investment environment in the first few months after COVID-19, the Business Climate Index (BCI) unveiled by the European Chamber of Commerce in Vietnam (EuroCham) on July 22 showed.
Accordingly, during the COVID-19 pandemic, when social distancing and travel restrictions brought normal business operations to a halt, the EuroCham BCI fell to its lowest-ever score of 27% in the first quarter of 2020.
However, after the Government implemented a world-leading public-health and economic response, Vietnam was able to return to business-as-usual much sooner than other countries, who continue to struggle with the impact of the virus.
As a result, the positive sentiment of European business leaders began to bounce back, recording a 7% jump between February and April to reach 34%.
The BCI also found that more than 25% of European enterprises had benefitted from the Government’s postponement of tax, while around one-in-five had benefitted from a reduction in rent and a suspension of social insurance contributions.
Despite these positive signs, however, challenges remain for European enterprises, according to the survey.
A large proportion, 88% of the interviewed businesses, felt negative effects as a result of the pandemic in the three months to April. Meanwhile, more than 50% said that a reduction in taxes such as corporate income tax, personal income tax and value added tax would help them emerge stronger from the crisis.
Chairman of EuroCham Nicolas Audier said this data is further evidence that Vietnam is one of the international success stories of the COVID-19 pandemic. It also shows that the Government’s effective and sure-footed handling has had a tangible impact on the confidence of European business leaders, he added.
The next challenge will be adapting to the “new normal” where COVID-19 is present in other countries but where global trade remains essential to domestic economic growth. This will require imaginative solutions to address issues such as the return of foreign experts on whom many international companies depend, he said.
Vietnam imposes anti-dumping duties on imported BOPP films
The Ministry of Industry and Trade (MoIT) has recently issued the Decision No.1900/QD-BCT on the official application of anti-dumping measures on some plastic products and plastic products made from propylene-based polymers, commonly known as BOPP films, imported from China, Thailand, and Malaysia.
The official anti-dumping duty ranges from 9.05 percent to 23.71 percent.
Before coming to the above decision to impose anti-dumping tax, the MoIT launched an investigation from August 2019 and found that the domestic BOPP film industry suffered significantly during the recent years. This has been shown by sharp declines in sales, revenues, profits, market share, and production capacity.
US$10 billion offshore wind power project to be developed central Vietnam
The 3.5GW La Gan project is one of the first large-scale offshore wind power projects in Vietnam.
The Copenhagen Infrastructure Partners and its partners Asiapetro and Novasia on July 22 signed a Memorandum of Understanding (MOU) with the Binh Thuan provincial government to develop the 3.5GW La Gan offshore wind project worth US$10 billion off the coast of Binh Thuan province.
The signing, which took place during the Vietnam Energy Summit 2020, was witnessed by the Head of the Party Central Committee’s Economic Commission Nguyen Van Binh, Deputy Prime Minister Trinh Dinh Dung, Minister for Industry and Trade Tran Tuan Anh and many high-ranking officials.
As the world’s leading investors and project developer in the field of offshore wind power, the Copenhagen Infrastructure Partners (CIP) has mobilized more than US$10 billion from investment funds worldwide for renewable energy projects.
With such the huge capacity, the La Gan project is one of the first large-scale offshore wind power projects in Vietnam. It is expected to enhance the country’s regional and international position in the area of renewable energy development, according to the embassy of Denmark in Vietnam.
Danish Ambassador to Vietnam Kim Højlund Christensen said that studies between the Danish Energy Agency and the Vietnam Electricity and Renewable Energy Authority show that Vietnam has about 160GW of offshore wind power capacity to exploit. Vietnam would learn from other countries’ experience to fully tap into the benefits brought about by offshore wind power.
Also at the event, TPBank and Bamboo Capital JSC signed a MOU on collaboration in funding arrangement of VND11 trillion (US$473.5 million) for renewable energy projects including wind power, solar power and solar rooftop.
A series of MOUs were signed among local partners and authorities including the one on cooperation in research and investment on LNG power plant in Ca Na between Trung Nam Group and Ninh Thuan province; another one on LNG power plant of Chan May – Lang Co Economic Zone between Chan May LNG JSC and the People’s Committee of Thua Thien Hue province; and an MOU on wind power development between local EPCIC partners Vietsovpetrol/PVC-MS and investor Enterprise Energy.
France provides 1.7 mln USD for tourism recovery in Cambodia
The French government, through the French Agency for Development (AFD), has provided a grant of 1.5 million EUR (1.7 million USD) to help restore Cambodia’s post-pandemic tourism sector, according to the Cambodian Ministry of Tourism.
Cambodia’s tourism sector has been severely affected during the COVID-19 outbreak due to the loss of foreign visitors as a result of the suspension of flights from many countries, Khmer Times reported.
The ministry estimated that as of May, around 2,956 tourism-related businesses in Cambodia have been closed, leaving a further 45,405 people unemployed.
Nep Samuth, General Director of Tourism Industry and Secretary-General of the National Committee for Clean Cities Assessment of the Ministry of Tourism, confirmed that AFD has agreed to provide 1.5 million EUR in funding under the Tourism Capacity Building Project 2020-2023 to participate in the rehabilitation of tourism in Cambodia after the pandemic.
According to Samuth, the two sides have exchanged views on the introduction of measures to support Cambodia’s tourism sector in the period of COVID-19 and starting from the implementation of tourism safety measures, promoting domestic tourism movement to ensure that Cambodia is a quality and warm tourism destination for visitors.
The fund will be used for 24 development projects to participate in the recovery plan during and after the pandemic, including strengthening the governance of the tourism sector, which will provide capacity building to strengthen the private sector in the tourism industry, enhancing the institutional capacity and public-private partnerships, and supporting the promotion of ecotourism.
Construction of over 5.2-trillion-VND wind farms begins in Bac Lieu
The construction of two wind farms with a combined capacity of 100 MW began in Hoa Binh district of the Mekong Delta province of Bac Lieu on July 26.
The wind power plants are built with a total investment worth over 5.22 trillion VND (about 226.66 million USD). They are expected to generate about 400 million KWh annually, raking in excess of 800 billion VND per year.
Phase 2 of the Hoa Binh 1 wind farm, spanning 935ha, is being built on the same premise as Phase 1 in a bid to raise land use efficiency.
Meanwhile, the Hoa Binh 2 wind farm will be in Vinh Thinh commune, covering a coastal area of nearly 1,120 ha.
The projects are to ensure energy security and bolster the use of clean energy to mitigate environmental pollution and contribute to the local socio-economic development.
Chairman of the People’s Committee Duong Thanh Trung said in addition to four wind power projects underway in the province’s coastal areas, Bac Lieu will welcome a number of new projects in the coming time with an aggregate capacity of 470 MW and nearly 1 billion USD in investment.
Besides, a 4-bilion-USD liquefied natural gas (LNG)-fueled power plant will be inaugurated in the province by early 2021.
He pledged that local authorities will create optimal conditions for the two projects, which are set to put into operation by November next year.
The province, with a 56 km-long coastline, holds great potential for developing wind and solar power.
JCB, Shopee unveil Southeast Asia collaboration
E-commerce platform Shopee has announced a tie-up with JCB International Company Ltd (JCBI) that will offer online merchants and shoppers enhanced payment options.
The partnership is launched in Indonesia, Thailand and Vietnam and will be followed by Singapore and the Philippines in the coming months.
JCB will offer year-round and seasonal discounts and an additional safe and secure payment method for shoppers; Shopee will also promote participating stores that support JCB.
Yoshiki Kaneko, president and chief operating officer, JCB International Company, Ltd said: “JCB is proud to be working with Shopee as we further commit to supporting our customers in the fast-growing Southeast Asia region. In particular, as consumer shopping habits shift to online and businesses digitise their activities, we want to be able to further cater to these evolving needs.
“Over the past 10 years Southeast Asia has been a growth market for JCB, and we are confident that together with Shopee we can provide high-quality payments services for businesses and consumers, and continue to grow together with the region.”
Terence Pang, chief operating officer of Shopee, said: “We are honoured to be a strategic business partner with JCB. As homegrown brands, both Shopee and JCB are deeply committed to supporting local Southeast Asian markets and businesses.
“We believe that JCB will bring added value to our eco-system and look forward to accelerating the digital economy in Southeast Asia together.”
In Vietnam, from now until March 31 next year Shopee users will be offered special promotions when paying with JCB cards such as a discount of 15 percent.
JCB started its overseas expansion in 1981 by building acceptance of travel destinations for Japanese card members. Since the early 2000s it has focused on expanding to Asian markets.
It has more than doubled its card members in Thailand, Vietnam, Indonesia, the Philippines, Myanmar, and Singapore between 2017 and 2019.
A joint report by Google, Temasek and Bain & Company, found that the Southeast Asia internet economy soared to 100 billion USD in 2019 after more than tripling in size over the previous four years.
By 2025 it is expected to grow to 300 billion USD./.
U.S. launches antidumping probe into copper pipe and tube imports from Vietnam
The U.S. Department of Commerce (DOC) last week launched an antidumping investigation to determine whether seamless refined copper pipes and tubes from Vietnam are being dumped at an alleged margin of 111.82% on the United States market.
The department said in a statement that the petition was filed by the American Copper Tube Coalition and its constituent members.
If the DOC concludes the finding to be true and the U.S. International Trade Commission determines that the dumped imports of such products materially injure or threaten material injury to the U.S. industry, the department will impose duties on those imports as per the amount of dumping found to exist.
In case the DOC finds that the products are not being dumped or the commission finds no injury to the American industry, the investigation would be terminated and no duties would be applied.
The preliminary antidumping determination is scheduled for December this year. A final ruling in this case is scheduled for next February but it may be extended.
The Trade Remedies Authority of Vietnam said the DOC will select certain Vietnamese exporters and producers of seamless refined copper pipes and tubes as mandatory respondents within 20 days since the announcement of the investigation.
They will be responsible for responding to all parts of the questionnaire from the U.S. agency within 30 days.
In case they fail to do so, the DOC will analyze the available data, which often places these exporters at a disadvantage, to draw its investigation conclusions, stressed the Vietnamese agency.
The 2019 imports of seamless refined copper pipes and tubes from Vietnam were valued at roughly US$146.5 million.
Seamless refined copper pipes and tubes are the fifth product to face trade remedy measures from the United States so far this year.
HCMC to put 61 land lots in Thu Thiem up for auction
HCMC is working to auction off 61 land lots in the Thu Thiem new urban area in District 2, it was announced at a conference on the city’s socioeconomic performance in the first half of 2020 on July 23.
Nguyen The Minh, head of the Thu Thiem new urban area investment and management board, stated that the city government has assigned the Land Fund Development Center under the HCMC Department of Natural Resources and Environment to prepare the auction plan for four land lots in functional zone No. 3. The department is evaluating the starting prices.
Proceeds from the auction will be used to pay VND2,873 billion in debt, site clearance compensation, infrastructure construction costs and advance payment from the city’s budget.
According to the auction plan that was approved by the city government in May, only real estate companies are allowed to participate in the auction. They will have to deposit 20% of the starting prices.
Speaking with The Saigon Times, Minh said the city has also assigned the Land Fund Development Center to prepare the auction plan for 3,700 resettlement apartments in the Thu Thiem new urban area. The city expects to finalize the starting prices this month.
Japan assists Matsuoka to make PPE in Vietnam
The Japanese government will support Japanese apparel maker Matsuoka Corp. to produce personal protective equipment (PPE) in Vietnam to diversify supplies and lessen its dependence on China amid the novel coronavirus pandemic.
NNA Business News, part of the Kyodo News Group, announced Matsuoka’s plans to invest three billion yen (US$28 million) in An Nam Matsuoka Garment Co., its Vietnamese manufacturing unit.
The move is aimed at starting the production of protective wear and other items in several months, the newspaper cited a Matsuoka spokesman in Japan as saying.
Matsuoka is one of 30 Japanese firms which were recently named recipients of official subsidies from the Japanese Ministry of Economy, Trade and Industry to promote the Northeast Asian country’s drive to diversify supply chains and lessen its dependence on China.
The Japan External Trade Organization, which announced the list of subsidy recipients last Friday, said 15 of the 30 firms are connected with projects in Vietnam and six in Thailand.
Matsuoka of Fukuyama, Hiroshima Prefecture, set up its Vietnamese unit last November before the coronavirus outbreak, as part of an ongoing campaign, to produce apparel products mainly in Southeast Asian countries, such as Indonesia, Myanmar and Bangladesh.
The apparel maker started producing facial masks earlier this year as Covid-19 spread globally.
Toba’s subsidiary to help Japanese manufacturers moving to Vietnam
Tokyo-based firm Toba Inc. has established a wholly owned subsidiary in Vietnam in anticipation that more Japanese manufacturers will invest in the Southeast Asian economy as they move out of China, according to an NNA news report.
Toba will offer its expertise in providing customized production solutions and work together with suppliers to develop products for manufacturers setting up operations in Vietnam.
With an investment of US$500,000, subsidiary Toba Inc. (Vietnam) Co. was founded in the Vietnamese capital of Hanoi on June 16. Staffed with five workers, the unit will start work early next month, the parent company said in a statement on Monday.
The subsidiary will sell control machinery, factory automation equipment, such as industrial robots and industrial equipment, apart from providing consultancy services on efficient, cutting-edge production.
The subsidiary will focus on Japanese manufacturers operating in Vietnam first. It subsequently plans to extend its business and services to local producers, similar to what its Shanghai and Bangkok subsidiaries have done, said a spokesman for the company.
Toba established a representative office in Hanoi earlier in 2014 to support customers in Vietnam who had bought products from the company as well as conduct market research. The new unit has taken over its role.
Some 19,000 enterprises suspend operations in HCMC in H1
As many as 18,743 companies in HCMC suspended their operations in the first half of this year due to the impact of the Covid-19 pandemic.
Of which 3,400 were dissolved, some 7,100 faced a temporary suspension and almost 4,000 others had to give up their business addresses, according to data from the HCMC Tax Department.
The majority of these companies are located in districts 1 and Tan Binh and up to 98.15% of them are in the private sector. Among them, the firms that have been operating for three to nine years accounted for more than half.
Retailers were the hardest hit among the affected businesses, making up over 38% of the total, followed by firms operating in the fields of processing, manufacturing, construction and real estate.
However, the number of newly-established firms during the period was equal to those forced to halt their operations. Eight new firms registered large amounts of capital, more than 2,800 companies resumed operations and 166 others moved to the city from various provinces and cities.
Most of the newly-founded firms operate in the trading and retailing industries, while the others are real estate developers and technology firms, chiefly located in districts 1 and 7.
Bidding for local power projects attracts many Chinese contractors
Most of the contractors submitting tenders to execute power projects in Vietnam are from China, according to a report of the national steering board on power development over the implementation progress of local power projects.
As for Na Duong II thermal power project, of which the Vietnam National Coal and Mineral Industries Group (TKV) is the investor, most of the 16 contractors buying bidding applications for the project to date come from China.
Earlier, TKV sent out bidding documents on January 6, with the bid closing time set for April 8. However, the impact of Covid-19 prompted the investor to reschedule the closing date of the first bid to May 6 and the second one to June 10.
Regarding the Quynh Lap 1 thermal power project, TKV began inviting investors to join the bidding since February 10. The final date for the bidding submissions was also rescheduled to March 31 due to the pandemic. As a result, TKV received eight applications, with seven submitted by Chinese investors and one from a local investor.
Once a qualified investor is selected and the prime minister approves the Quynh Lap 1 project by the end of this year, it can be put into operation between 2026 and 2027.
The report also revealed that the pandemic has slowed down the progress of many thermal power projects including Hai Duong, Duyen Hai 2, Nghi Son 2 and Van Phong 1.
Vietnam’s hotels see steady dip in occupancy rates
With the large number of new hotels sprouting up in tourism hotspots, far exceeding the demand, room occupancy rates at hotels in Vietnam have steadily declined in recent years, with data from the Vietnam National Administration of Tourism indicating that the average room occupancy rate fell from 57% in 2017 to 54% in 2018 and 52% in 2019.
The tourism hotspots that saw a boom in new hotels such as Danang, Khanh Hoa, Sapa and Phu Quoc saw their room occupancy rates fall sharply, sometimes to below 50%. Meanwhile, the rates in HCMC and Hanoi, where there haven’t been too many hotels operating in recent years, have been over 60%.
Some enterprises told The Saigon Times that luxury hotels have had higher room occupancy rates than budget hotels because more tourists are choosing to stay in four- or five-star hotels in Vietnam.
As a result, investors are investing more in large-scale, luxury complexes that offer comprehensive services, from accommodation and catering to leisure and sightseeing. In 2019, four- and five-star hotels saw the largest growth, with the number of new four- and five-star hotels growing by 11% and 16.2% year-on-year, respectively.
Between 2015 and 2019, the number of international tourists to Vietnam increased by 22% per year from 7.9 million to 18 million. The number of new hotels also saw a corresponding increase.
According to the Vietnam National Administration of Tourism’s 2019 Vietnam Tourism Report, the country had some 2,000 new tourist accommodation establishments, with 100,000 rooms put into service last year.
“The growth in international and local tourists has given a boost to tourist accommodation investments in tourism hotspots,” the administration stated in the report.
In 2019, Khanh Hoa Province had 6,000 new hotel rooms, while Danang City and Phu Quoc Province had 4,500 and 3,000 new rooms, respectively.
Between 2015 and 2019, the number of tourist accommodation establishments grew by 12% annually, from 19,000 to 30,000. The number of rooms also jumped from 370,000 in 2015 to 650,000 in 2019, including over 100,000 rooms of 484 five-star hotels and resorts.
Besides tourism hubs such as HCMC, Hanoi and Quang Ninh, more four- and five-star hotels are also being developed in Phu Quoc and the south central provinces. As of last year, 41 cities and provinces in the country had four- or five-star hotels.
Dai-ichi Life Holdings sets up representative office in Vietnam’s capital
The Ministry of Finance has granted approval allowing Dai-ichi Life Holdings to establish a representative office in Hanoi, as announced by Seiji Inagaki, president and representative director of the leading Japanese life insurer, on July 8.
In 2007, Dai-ichi Life Holdings established its Vietnamese arm as the first international life insurance business in the Southeast Asian country. Since its foundation, Dai-ichi Life Vietnam has achieved exceptional growth and maintained its position as one of the top performers in the life insurance market.
Group president Inagaki pointed out that Vietnam has achieved remarkable economic growth and its life insurance market has expanded.
“We see further market expansion supported by sustainable economic development and a population of approximately 96 million people. We already send staff to Dai-ichi Life Vietnam’s headquarters in Ho Chi Minh City and, in addition, we are establishing a representative office in Hanoi, and sending new staff to represent us,” said Inagaki.
The Hanoi representative office will not only conduct research and surveys on the insurance market and regulatory trends, but also work on building relationships with relevant local authorities and Japanese companies in Vietnam. Moving forward, Dai-ichi Life Group will continue creating sustainable values by fully utilising its global trilateral structure which includes Japan, North America, and Asia-Pacific.
Tourism sector urged to achieve dual goal amid COVID-19
Minister of Culture, Sports and Tourism Nguyen Ngoc Thien has called on the tourism sector to achieve the dual goal of fighting the COVID-19 pandemic and developing socio-economy in the current context.
During a conference in Hanoi on July 28 reviewing the sport-tourism sector’s six-month performance and outlining key tasks for the remaining months of this year, Thien said the sector should uphold the past achievements after the pandemic has been under control, including making the best preparations for the 31st Southeast Asian Games and the 11th ASEAN Para Games.
Between now and the year-end, the sport sector was assigned to continue developing physical exercises and sports nationwide in response to the campaign “All people take exercises following the example of great Uncle Ho”.
It also must prepare for athletes competing in the sixth Asian Beach Games, qualification rounds of Olympic and Paralympic tournaments, as well as regional, continental and world sport championships next year.
The Vietnam National Administration of Tourism (VNAT) was required to prepare necessary conditions to welcome foreigners once COVID-19 is under control while stimulating domestic tourism via the campaign “Vietnamese people travel Vietnam”, the media campaign “Safe Vietnam”, helping to popularise a safe, friendly and attractive country.
According to the VNAT, the number of foreign tourist arrivals in Vietnam surpassed 3.68 million in the first half of this year, down 49.5 percent year-on-year while the number of domestic visitors reached 23 million. The total revenue from tourism reached 176.8 trillion VND (7.68 billion USD), down 47.7 percent annually.
In the first quarter, 95 percent of travel agents suspended operations, occupancy at lodging facilities only reached near 20 percent, and the number of companies applying for new outbound travel licenses slumped by 48 percent. In March – April, hotels and lodging facilities basically shut down operations.
Notably, during the domestic demand stimulation period from June, many localities recorded a 1.5 to three-fold surge in tourist arrivals, including Sa Pa (Lao Cai), Quang Ninh, Sam Son (Thanh Hoa), Quy Nhon (Binh Dinh), Phu Yen, Phu Quoc (Kien Giang).
In the first half of this year, Vietnamese athletes competed in 18 international tournaments, winning 26 golds, 11 silvers and 8 bronzes.
The ministry completed the building of ministry-level e-government architecture, launched V-office system in its units, and sent dossiers to the UNESCO seeking the recognition of Dong Ho folk painting as intangible cultural heritage in need of urgent safeguarding, and Xoe Thai dance as intangible cultural heritage of humanity.
Workshop discusses anti-corruption efforts in private sector
A consultation workshop on a draft report and guidelines for non-State enterprises and social organisations to implement anti-corruption laws was held in Hanoi on July 28.
The workshop was jointly held by the Government Inspectorate, the Vietnam Chamber of Commerce and Industry (VCCI), representatives from the British Government, the “Promoting a Fair Business Environment in ASEAN” project, and the UN Development Programme (UNDP).
Deputy Inspector General Tran Ngoc Liem said the report will help the Government Inspectorate compile guidelines for non-State enterprises and organisations to implement anti-corruption legal regulations in line with the 2018 Anti-Corruption Law and Government Decree No 59/2019/ND-CP dated July 1, 2019 which details certain articles of the law.
The report identifies ambiguities in the law and analyses international experience, and takes on board opinions from experts and relevant parties, he added.
The Anti-Corruption Law was expanded to the non-State sector quite recently, with the 2018 version comprising ten articles focusing on the sector, Liem said.
Do Thanh Thuy, a UNDP expert, proposed non-State enterprises, organisations, and associations raise their awareness about anti-corruption efforts and add them into their operational regulations.
Dau Anh Tuan, head of the VCCI’s Legal Department, emphasised the need for businesses to equip themselves with knowledge and the capacity to deal with the issue, adding that transparency must be a feature of every transaction.
Anti-corruption efforts in businesses and organisations must be supervised by shareholders, consumers, the media, and independent organisations, he said.
The State should complete policies and processes to protect companies that operate transparently and in accordance with regulations, and the business community should join in such efforts, he suggested.
Nissan gets new Vietnam distributor
The Vietnam Automobile Industry Development Company (VAD) has inked a deal with Nissan to become the Japanese carmaker’s exclusive distributor in Vietnam.
The company announced Thursday that IT will take over the vehicle distribution starting October 1 after Nissan and Tan Chong Motor Holdings Bhd officially cut their ties from September 30.
VAD is a recently established company located in the Viet Hung Industrial Park in northern Ha Long Town. It began operations on August 28. It has a charter capital of VND350 billion ($15.1 million) and registered 28 lines of business, with the main line being the wholesale distribution of cars and other motor vehicles.
Currently, Nissan has its Sunny, X-Trail, Terra and Navara models in the Vietnamese market. Of these, only Sunny and X-Trail models are assembled in Vietnam. A total of 1,414 units of these two models were assembled in the first eight months of this year.
Tan Chong, a multinational corporation based in Malaysia, will retain its presence in the local market, becoming the distributor for British automaker MG, which is owned by Shanghai-based Chinese state-owned SAIC Motor Corporation Limited.
VN aviation sector rebounds with reopening of air routes
Vietnamese airlines have recently unveiled plans to resume air routes following the containment of the second coronavirus outbreak, showing the fact that the aviation market has begun to pick up again.
National flag carrier Vietnam Airlines recently deployed a range of promotional activities aimed at stimulating travel demand. It also exerted all-out efforts in a bid to ensure service quality and the implementation of COVID-19 prevention and control measures.
A representative from Vietnam Airlines stated that the firm had transported approximately 40,000 passengers on its domestic routes between the beginning of the year and September 21, representing an annual increase of 12%.
Currently, the firm operates more than 40 routes with nearly 200 flights per day. With the COVID-19 epidemic being gradually brought under control, the airline has added more flights on eight of its domestic routes between Hanoi and localities such as Vinh, Quy Nhon, Da Nang, Tuy Hoa, Nha Trang, Da Lat, and Pleiku, in addition to between Ho Chi Minh City and Da Nang.
From October 1, it will reopen six domestic routes, namely Hai Phong to Da Lat, Nha Trang, and Buon Ma Thuot, Da Nang to Da Lat and Buon Ma Thuot, in addition to Hai Phong to Da Nang.
For the occasion, the airline has offered discounted tickets priced at only VND99,000 for a one-way ticket, equivalent to VND579,000 including taxes and fees, on these routes, with the departure time starting from October 1 to December 31.
Simultaneously, Vietnam Airlines has co-operated with Pacific Airlines to introduce several products for passengers.
Meanwhile, Bamboo Airways announced on September 23 that they will officially resume domestic routes from Hai Phong, Vinh, Da Nang, and Can Tho to other localities nationwide from September 28 to October 12.
At present, local airlines are working to gradually reopen international flights in line with the Government’s instructions and approval from foreign authorities.
Most notably, Vietnam Airlines officially put tickets on sale on September 23 for the first regular international commercial flight from the Republic of Korea following the suspension of international flights due to the impact of the COVID-19 epidemic.
Commercial flights from RoK officially resume
The first commercial flight took off from Seoul in the Republic of Korea (RoK) on the morning of September 25 to Noi Bai International Airport after a period of international routes being suspended due to the novel coronavirus (COVID-19) epidemic.
Flight VN417 was carried out by national flag carrier Vietnam Airlines and transported more than 100 passengers from Incheon International Airport in the RoK to Hanoi’s Noi Bai International Airport.
Vietnam Airlines in co-ordination with relevant units have made thorough preparations for the journey in recent days as part of efforts for the airline and other carriers to reopen a number of international air routes.
This comes following the COVID-19 epidemic being successfully brought under control in the nation and many other countries globally.
During the duration of the flight, a number of strict epidemic prevention measures were put in place, with passengers being required to present mandatory proof of a negative COVID-19 tests, through PCR diagnostics, that was issued three days prior to the flight.
In addition, travelers had to confirm the location of their quarantine facility upon arrival in Vietnam or download the contact tracing app in line with regulations.
Furthermore, Vietnam Airlines also successfully carried out the first regular international commercial flight from Hanoi to Tokyo in Japan, with approximately 60 passengers on board.
The majority of passengers were made up of international students, Vietnamese guest workers, and some Japanese citizens.
Aside from air routes with Japan and the RoK, the national flag carrier has plans to restore flights between the nation and China, Taiwan (China), Laos, and Cambodia in the near future. VOV
Banks struggle to sell cars to collect debts
Hundreds of cars serving as collateral for bank loans have been put on sale by commercial banks to collect debts.
The officer of a joint stock bank in Hanoi said the bank has foreclosed on hundreds of cars this year, but the number of cars sold has been very modest.
Some years ago, when the economy was growing well, people rushed to borrow money from banks to buy cars and apartments. In 2016-2019, the loans to fund car purchases grew by 40 percent per annum.
Banks applied measures to lure borrowers, accepting to lend up to 80-90 percent of the cars’ value.
As many borrowers cannot now pay debts, banks have to foreclose on cars, which are collateral for loans, to sell for debt collection.
The officer said it is most difficult to sell passenger cars with 16-45 seats. As travel demand has decreased in Covid-19, many transportation firms have had to suspend their operation. Because of the decreasing travel demand, no one wants to buy these vans.
As cargo transportation demand is on the decrease, people aren’t think of buying trucks now. As for sedans, both used and brand-new cars have seen prices drop sharply, while the supply is plentiful.
|As cargo transportation demand is on the decrease, people aren’t think of buying trucks now. As for sedans, both used and brand-new cars have seen prices drop sharply, while the supply is plentiful.|
An analyst said that the cars put up for sale by banks are mostly ones voluntarily handed over by clients because they cannot sell themselves for a good price, or are ones foreclosed on by banks.
In many cases, before handing over the cars to banks, the owners of the cars have changed interior equipment or replaced parts with low-quality components. Banks are not able to recognize the changes.
In general, banks sell cars at first-price sealed-bid auctions. Information about the cars is limited. Banks only give information on the brand, year of manufacturing, color, vehicle registration number, mileage and starting prices. Buyers also cannot access the cars before attending the auctions.
Le Quoc Huy, the owner of a business in Thanh Tri district in Hanoi, said he wanted to buy a Chevrolet Van 2017 series which had the starting price of VND185 million from a bank, but he later gave up the plan.
“I intended to buy this van to transport cargo within the city. But I was not sure about the status of the van, whether its components were original,” he explained. “If I have to spend more money to repair the van, it would become too expensive. So, I finally decided not to buy the car.”
The man admitted that many cars cannot find buyers though they have been put up for auctions four or five times, with the starting price decreasing by 5 percent each time.
A car dealer said he doesn’t intend to buy these cars. “The used car supply is still high. It is not easy to sell used cars now,” he explained.
VIB, Sinhan Bank, Techcombank, VP Bank and TP Bank are the biggest lenders funding car purchases.
Analysts said, as the economy is in difficulty because of Covid-19, credit has been growing very slowly as businesses don’t have high demand for loans at this time to expand production.
As a result, banks are trying to promote consumer credit. Tens of trillions of dong worth of capital have been reserved to fund house and car purchases.
Car buyers can borrow money at interest rates of 6.5-9.5 percent per annum for 6-12 month loans.
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