Two North-South expy subprojects proposed to be transferred to public investment
The proposal was made as the Ministry of Transport failed to woo investors for these subprojects, the local media reported.
The Government also suggested the NA’s Standing Committee assign it with executing subprojects that have been moved to the public investment model to put them into service in 2023 and work out plans to recover capital to repay the State budget.
The 50-kilometer Nghi Son-Dien Chau section requires an investment of VND8.38 trillion. No investor has registered to participate in a tender for the subproject.
As for the 43-kilometer National Highway 45-Nghi Son subproject, the investment was estimated at VND6.33 trillion. Only a consortium of Licogi16 – FECON – 486 submitted dossiers to join a tender for the subproject. However, the Ministry of Transport has canceled the tender as the consortium failed to meet the requirements of the tender.
According to the Government, the technical design, capital estimation and site clearance for the two subprojects have been 92% completed, which have paved the way for the groundbreaking of the subprojects in the first and second quarters of next year and their completion in 2023.
If the Ministry of Transport holds other tenders to choose investors for the two subprojects, the time required to complete them will be extended for 10 more months.
Education technology is seen as a fertilising land for local startups, but to get boons from brand new sectors, they first need to solve inequitable technology accessibility across the country.
Ngo said that even though a quarter of Vietnam’s near-100 million population are classed as students, most of them are not located in urban areas and so their opportunities to approach brand new technologies are largely limited.
“Instead of only focusing on students living in big cities, it is necessary to find ways to effectively give access to the remaining subjects which account for a large part of the total,” Ngo added.
Dao Lan Huong, chairman and founder of Teky Academy, told VIR that popularising edtech in urban areas is easier than in suburbs or rural areas. “In big cities, in addition to parents being willing to pay for education, it is easier for new kinds of education to become more common because such cities always attract more novel ideas.”
Currently, Teky Academy is accelerating promotional activities for edtech products in other cities and provinces. “Marketing plays the most important role in popularising new kinds of education,” said Huong. “Once edtech becomes more well-known to parents, putting it into operation will be more favourable.”
In addition to Hanoi and Ho Chi Minh City, this company is targeting the northern port city of Haiphong, Danang in the central region, and more.
Attending the Vietnam Venture Summit 2020, Nguyen Phuong Hanh, a teacher at Just Kids kindergarten, told VIR that during the health crisis this year, many parents became interested in edtech, while the school is also developing an edtech platform by itself.
“I came here to find opportunities to partner up with businesses specialised in the sector. However, from what the speakers said at the event, I have yet to be satisfied,” said Hanh. “I am looking for actual solutions for the shift from offline to online, while they just focused on experiences in operating in the segment.”
Meanwhile, Tran Viet Hung, chairman and founder of domestic edtech startup Got It, said that the key factor deciding the make-or-break of any edtech platform is training quality. “Edtech companies have to focus on offering quality lectures on platforms – specifically, how to provide them products satisfying the actual demand of learners and teachers,” he explained. “That is a big challenge for any local startup working in the sector because most online learning platforms in Vietnam are only in the first phase of development.”
Moreover, Hung emphasised that to operate edtech platforms well, businesses do not have to prioritise gathering plenty of teachers or learners, but instead should focus on creating a useful platform that must become the first choice for them.
According to information published at the Vietnam Venture Summit 2020, the country is home to more than 100 startups specialised in edtech, focusing on content, online classes, online-to-offline, and business-to-business. Besides that, the local edtech market this year is valued at about $103 million, on a scale that is set to increase.
Spending on education makes up about 40 per cent of local people’s income, and the expenditure is expected to grow in forthcoming years. The Ministry of Education and Training recently issued a decision outlining integrating technology with education from kindergarten to Grade 12.
With nearly 50 million smartphone users and Southeast Asia’s leading internet use, Vietnam is an appealing destination for educational investors across the world. According to a survey of about 50 international funds this year, edtech will be the leading target of investors in the next 12 months.
Trinh Minh Giang, CEO of Global Elite Education and Training Corporation, said that some of the difficulties in the sector are that local people still rely on traditional education platforms and get too familiar with using the free-of-charge learning resources. Nevertheless, the challenges also pave immense opportunities for startups. “If they enter the sector as soon as possible, their chances to succeed will also improve,” Giang said.
Annual international food industry expo to go virtual
The 2020 Vietnam International Exhibition on Food Industry (Vietnam Foodexpo 2020) will be held virtually from December 9 to 12.
According to the organisers, the 2020 Vietnam Foodexpo has attracted nearly 300 companies from 27 provinces and cities around the country, including Hà Nội, HCM City, Cần Thơ, An Giang, Bình Dương, Bắc Ninh, Bắc Giang, Bình Phước, Bình Thuận, Đắk Nông, Đắk Lắk, Đồng Nai, Đồng Tháp, Gia Lai, and Tiền Giang.
They will display a variety of products such as fruits and vegetables, beverages, tea and coffee, food ingredients, fine foods, seafood, and food processing technologies and equipment.
It has accepted registrations to visit from foreign importers from a number of countries and territories such as South Korea, Japan, Europe, Poland, Canada, Russia, India, and the US.
Exhibitors can display their company profile, product images and production processes in their virtual booths, and will be widely and easily accessible to domestic and international buyers.
Moreover, the virtual platform will help enterprises actively manage appointments with partners and interact and connect directly with buyers on a global scale via Chat Box or online video calling.
It will allow exhibitors to connect and seek business partners, get an overview of food supply and demand, new consumption trends in the food industry in the Vietnamese and international markets and new solutions for product development.
It is expected that thousands of transactions will be done at the expo.
Vietnam Foodexpo has been held since 2015.
Visitors can register to visit at https://e.foodexpo.vn/common/signup.
Vietnam’s exports in 2020 remain buoyant despite coronavirus: trade ministry
Vietnam is projected to export US$267 billion worth of goods in 2020, up 1% from the previous year, despite the adverse impacts of the Covid-19 pandemic on the global economy.
The forecast was made by the Vietnam Trade Promotion Agency (Vietrade) under the Ministry of Industry and Trade (MOIT) at a conference held in Can Tho Province on December 4.
Vietnam already posted export revenue of US$254.6 billion in the first 11 months of 2020, up 3.5% year-on-year, and registered a record-high trade surplus of US$20.1 billion.
Vietrade Director Vu Ba Phu said that trade promotion activities went smoothly in the early months of 2020 but then began to face difficulties from March onwards with numerous conferences, workshops and trade fairs having been cancelled or postponed.
He noted that as growth in most economies in the world falls into the negative territory, Vietnam’s expected 1% export growth is highly encouraging, which comes as a result of the significant efforts by the government and business community.
Speaking at the conference, MOIT Deputy Minister Do Thang Hai asked Vietrade to increase the use of information technology and step up both offline and online trade promotion events so that exports are not interrupted by Covid-19.
He added that the agency needs to support Vietnamese enterprises to tap into new opportunities and enhance their competitiveness in the context of the pandemic and international integration.
Thai firm spends $39.9 million acquiring solar farm in Vietnam
Gunkul Engineering Plc. has acquired a solar farm in Vietnam at a cost of $39.9 million, or ฿1.26 billion, as reported by the Bangkok Post.
She said the deal, which was concluded last week, includes the purchase of 49 per cent of shares from Bangjak Green Energy Co., a subsidiary of Bangkok-based BS Industry Service Co., and 51 per cent of the shares from two individual Vietnamese shareholders.
The construction of Phong Dien II plant was recently completed. The facility will be connected to the state grid, operated by Vietnam Electricity, under a power purchase agreement, with a feed-in tariff of 7.09 US cents per kWh granted to the operator for 20 years.
The project is expected to start commercial operation on December 15.
“The acquisition of DST’s ordinary shares is part of the company’s plan to invest in solar power business in Vietnam,” said Sopacha. “This will help expand the company’s business in Southeast Asia and promote our growth in terms of assets and operations.”
Over the past year, there have been a few notable power projects in Vietnam involving Thai sponsors, including, among others, the acquisition and financing of 100MW photovoltaic solar power plant in the southern province of Tay Ninh, the acquisition of 550MWp Loc Ninh 1, Loc Ninh 2 and Loc Ninh 3 photovoltaic solar power projects, and the 220kV Loc Ninh-Binh Long Transmission Line Project in Binh Phuoc; the acquisition of a 310MW wind turbine power plant in the Mekong Delta province of Ben Tre; the project take-out financings of 50MWp solar power plant and substations and the 257MWp utility-scale photovoltaic solar power plant in the central province of Phu Yen.
Experts predict that there is a trend in acquisition activities by Thai investors in the offshore, nearshore and onshore wind space, followed by greenfield project financing or project take-out financing activities.
DATC auctions more than 4 million shares of MSB
Vietnam’s Debt and Asset Trading Corporation (DATC) has offered to sell a complete lot of more than 4 million shares of the Vietnam Maritime Commercial Joint Stock Bank (MSB) on December 23.
The whole batch of shares or 0.34 per cent of the stake of the bank will be offered at a starting price of VND52.4 billion (US$2.27 million), according to the Ha Noi Stock Exchange (HNX).
HNX said both domestic and foreign investors were eligible to participate if they meet DATC’s requirements for current ownership ratios to comply with current bank regulations, adding purchasing time would be from December 23 to December 29.
Previously, the MSB board agreed the starting price of shares was VND46.4 billion then they increased to the value to VND52.4 billion or VND13,000 each share.
The bank has been issued a certificate of securities registration by the Vietnam Securities Depository and is completing the listing filing on the HCM City Stock Exchange (HoSE).
In the first nine months, MSB recorded net interest income of VND3.28 trillion and pre-tax profit of more than VND1.66 trillion, up 61 per cent and 56 per cent respectively from the same period last year. With this result, MSB has exceeded 15 per cent of its full-year profit target.
As of September 30, the bank’s total assets reached nearly VND166.5 trillion, up 6 per cent compared to the beginning of the year. According to the third quarter 2020 financial report, the bank has settled all issued bonds and had no bad debts at the Viet Nam Asset Management Company (VAMC).
Many banks continue lowering deposit rates
Many major banks have revised down the deposit rates for most tenors by 0.1-0.2 percentage point against the rates in November.
At the Vietnam Bank for Industry and Trade (VietinBank), the rate for savings of three to five months is now 3.4%. The rate for a tenor from six months to less than 12 months is 4%. Its current highest rate for deposits of 12-36 months has been cut by 0.2 percentage point to 5.6%.
The Bank for Investment and Development of Vietnam (BIDV) also lowered deposit rates by up to 0.2 percentage point for most tenors. The bank quoted the annual deposit rate for a tenor of 1-2 months at 3.1% and at 4% for tenors of six to nine months. The current highest deposit rate at BIDV is only 5.6% per year for tenors of 12-36 months.
At another major bank, Agribank, the deposit rate for tenors of six to 11 months was revised down to 4% per year. The rate for savings of 12-24 months fell by 0.2 percentage point month-on-month at 5.6%, Nguoi Lao Dong Online reported.
Besides, the deposit rates for tenors of 36-60 months are no longer quoted at many commercial banks.
At Nam A Bank, the annual rate for deposits of six to 11 months is now 6.2%, down 20 basis points against the previous rate. The bank also cut the rate for tenors of 18-29 months to 6.8%.
A report from SSI Securities Corporation showed that the liquidity of banks remained abundant, while the deposit rates are expected to move flat in the coming months.
Meanwhile, economics expert Can Van Luc said the rates for savings would either inch down or remain stable in the next few months.
Korean investors seek opportunities in Da Nang IT Park
Representatives of almost 30 Korean firms have been seeking investment opportunities in the Da Nang Hi-tech Park after paying a field visit to the new operated surface-mount technology (SMT) factory on December 4.
General director Nguyen Anh Huy from Da Nang Hi-tech Park joint-stock development company said the visit was part of the investment promotion programme to attract hi-tech investors from Korea.
Huy said the IT Park, which was built on 131ha in the first phase costing US$47 million, offered good conditions for working and living in a combined urban zone in the northwest region of Da Nang.
He said investors would get special preferential mechanisms from the park with free land rental from five to 50 years depending on investment scale, and preferential corporate income tax for 15 years.
“We offered top priorities for hi-tech investors with positive investment promotion policies in filling up working space in the first phase park in three or five years, Huy said during a meeting with Korean investors including Busan and Incheon Ports, Lotte Land, Hanwha Techwin Security Viet Nam, LS Electric and Posco.
“Investors will be exempted from import tax of production material and information technology service as well as export tax.
“The park had reserved 26ha for eco-living urban near the park in offering living space for investors and their families,” he said.
He added the park has called hi-tech engineers and experts from the US, Singapore, Japan, Europe and Korea to create a ‘Silicon Valley’ in central Viet Nam.
Last month, Korea’s LG Electronics began construction of its research and development (R&D) centre – the second in Viet Nam – at the Da Nang Information Technology Park Tower
Da Nang IT Park company plans to invest $74 million in the second phase on 210ha for investors from Silicon Valley and businesses in healthcare, high-tech industries, Artificial Intelligence (AI), education, real estate and automation.
According to the city’s investment promotion agency, Korea is one of the top five foreign investors in Da Nang with 232 projects worth $390 million – 11 per cent of total foreign direct investment fund.
The Consulate General of the Republic of Korea was opened in Da Nang last month in boosting investment and trade between Korea and central Viet Nam.
The South Korea Trade and Investment Agency (KOTRA) also debuted a representative office in Da Nang to promote investment and connections with Korean investors from 2018.
VNR petitions for reduction of infrastructure charge
Vietnam Railway Corporation (VNR) has proposed reducing the infrastructure charge from 8% of its railway transport revenue to 2% due to the difficulties caused by Covid-19.
The proposal has been sent to the Ministries of Transport and Finance and the Commission for the Management of State Capital at Enterprises.
This year, VNR may generate nearly VND3.2 trillion in revenue and its losses were estimated at VND643 billion. It has minimized its operation cost and furloughed its staff.
VNR and transport firms have encountered cash flow difficulties to maintain their operations. They are finding it hard to overcome their budget deficit, VNR Chairman Vu Anh Minh said.
VNR needs VND320 billion in 2020 and VND350 billion in 2021 to make good its losses.
VNR’s railway transport revenue was estimated at VND2.7 trillion this year. With this revenue, it will have to pay VND213 billion as the infrastructure use fee.
If the proposal to reduce the infrastructure use fee is approved, the fee will be cut by VND160 billion. The reduced amount in 2021 will be an estimated VND179.5 billion.
Thus, the firm can make good half of its budget deficit.
Hue kicks off development of night-time economy
A project to develop tourism products and services for the night-time economy in Hue City for the period 2021-2025 with a vision to 2030 is under discussion and will be implemented step by step starting before the 2021 Lunar New Year festival, a.k.a. the Vietnamese Tet (early February), said Phan Thien Dinh, head of the Hue City Party Committee.
He told The Saigon Times that some works will be completed soon in order to serve people on the occasion of the largest Vietnamese holiday. Apart from the existing night walking street around Pham Ngu Lao and Vo Thi Sau street in the downtown area, other night quarters will also gradually emerge on the street around the Dong Ba Market bus station and the Imperial Citadel area.
Reportedly, the project consists of six parts, which will be operational from 6 p.m. to 6 a.m. and focus on some key services, such as entertainment, food and beverages, shopping and sightseeing.
To implement the project, some investments will be made such as a public lighting system on the pedestrian streets, riverboat stations and parking lots, apart from the participation of souvenir sellers, craft villages and shopping malls.
Hoang Hai Minh, Chairman of Hue City People’s Committee, said the project will contribute to making Hue a green and festival city.
He also suggested some products for the projects, including “Hue Cuisine at Night”, “Royal Night” and the “Night Museum”.
High expectations on renewable energy
Renewable energy (RE) projects from wind, sunlight, and biomass are expected to make up for the shortage of electricity supply and gradually replace thermal and hydroelectric sources of power. This is especially important in the context that thermal power plants, especially small hydroelectric power plants, are negatively affecting the environment.
According to the updated report of the Science Council of Vietnam Energy Magazine, the power demand of the whole system in the next two years will be 15,400 megawatts (MWs). Meanwhile, in 2021, only about 3,600MWs of the capacity of three coal-fired power plants will be put into operation, namely Duyen Hai 2 BOT, Song Hau 1, and Hai Duong BOT. And by 2022, there will be Thai Binh 2, Nghi Son 2 BOT coal-fired power projects.
Thus, by the end of 2022, Vietnam will only add 6,000MWs from traditional sources of power, and there will be a shortage of more than 8,000MWs of capacity. By 2023, the traditional power sources will have only one more unit of the Van Phong 1 BOT Coal-Fired Thermal Power Plant with a capacity of 660MWs and the Nhon Trach 3 Gas Thermal Power Plant with a capacity of 880MWs. In total, in 2023, there will be 1,540MWs more, and more than 6,000MWs of power will remain insufficient.
From 2024 to 2025, according to the plan, many traditional power sources will be added, but the risks of delay are still evident. Therefore, the challenge is whether it is possible to strongly develop sources of RE with a capacity of more than 8,000MWs in the next two years.
Responding to this question, many experts affirmed that the sources of RE could meet a capacity of 8,000MWs within the next two years. In fact, within the past two years, after the Prime Minister decides the price support mechanism for RE, the sources of RE have grown rapidly, adding thousands of MWs to the national power system.
The latest information from Vietnam Electricity (EVN) shows that 113 solar and wind power projects with a total capacity of over 5,700 MWs have been released at full capacity and put into operation this year. This is a record number of new plants energizing in a short period.
The whole power system has mobilized 5.41 billion kWh from renewable energy, of which solar power reached 4.71 billion kWh, 5.35 times higher compared to the same period last year. Noticeably, if subtracting 1,000MWs of renewable energy by the end of last year, the country has 4,700MWs more in 2020. With the current growth rate, the sources of renewable energy can be supplemented to the system by more than 10,000MWs.
Especially, amid the current context, many private enterprises and people have continuously invested in solar power systems on the roofs of factories, farms, and townhouses. Similarly, for wind power, currently, there are active 16 projects with a total capacity of 642.6MWs. 13 wind power projects are under construction and expected to be put into operation in 2021, with a total capacity of 901MWs.
The rapid development of renewable energy has forced the Ministry of Industry and Trade (MoIT) to urgently revise the power plan. By the end of August this year, the total capacity of wind and solar power sources approved for the revised plan is nearly 23,000MWs. Of which, solar power is about 11,200 MWs, and wind power is about 11,800MW.
At the Vietnam Energy Forum 2020 that took place in mid-June this year, Deputy Minister of Industry and Trade Hoang Quoc Vuong (currently Chairman of Vietnam National Oil and Gas Group) said that the ministry would build transparent and competitive mechanisms to attract potential investors to develop RE projects.
Currently, the MoIT has been finalizing the draft National Power Development Master Plan for the period from 2021 to 2030, considering 2045 (a.k.a Power Development Master Plan 8) to submit it to the Prime Minister for approval. According to the scenarios in Power Development Master Plan 8, coal-fired power capacity will decrease by over 16.4 gigawatts (GWs), or 30 percent; hydropower capacity will reduce to 25 percent; gas power capacity will increase by nearly 7.8GWs or 42 percent; especially, wind power capacity will rise by 13GWs or three times higher, and solar power will surge by 6.2GWs, or 1.7 times higher. They are considered as good signs for a cleaner structure combination of power sources, significantly reducing gas emissions that cause environmental pollution.
Earlier, after balancing the long-term power supply, the MoIT sent a document to the Prime Minister, suggesting and proposing the Prime Minister to direct the People’s Committees of provinces with hydropower projects and related agencies to not consider the proposals to supplement the planning for hydropower projects with a capacity less than 10MWs in the area.
For small hydropower projects in the planning but have not been constructed yet, they should be halted and only implement after the overall assessment results are released.
Currently, the MoIT continues to review hydropower projects that are already in the planning in the provincially-governed areas, evaluating in all aspects, such as legal compliance, environmental and social assurance, to complete the Power Development Master Plan 8.
Agreeing with the proposal of the MoIT, some experts said that it is necessary to stop building more hydroelectricity. Because the reservoirs water transfers of hydropower projects have negative impacts on the living environment of the people. Besides, the impacts of flood regulation, reservoirs can easily cause landslides, leading to serious consequences. Meanwhile, the investment in RE is more effective thanks to low costs and fewer impacts on the environment and society.
Land prices around Hanoi jump
Experts said the prices have been pushed up and exceeded people’s affordability.
Prices of land in Hanoi’s suburban areas have been increasing two or three times over the last few months, resulting in both positive sentiment and concerns over the suprising rise.
The momentum becomes familiar in the outlying districts of Hoai Duc, Thach That, Dong Anh and Ba Vi where intensified investment in infrastructure, new property projects and high demand are all seen.
Some areas of Dong Truc and Thach Hoa communes in Thach That district and Yen Bai, Van Hoa, and Tan Linh communes of Ba Vi district record a two-fold increase than before, according to Kinh te & Do thi Newsppaper.
Nguyen Quoc Tuan, a real estate broker working in Di Trach commune, Hoai Duc district, supported the idea by taking Kim Chung Di Trach New Residential Area as an example, saying that the project is invested by Vietnam Trading Engineering Construction Joint Stock Company (Vietracimex) saw a three-fold increase in the prices of shop houses compared to that in 2008.
Regarding infrastructure, Chairman of Hoai Duc district Nguyen Hoang Truong said the local authorities since mid-2019 have finished site clearance for a belt road and started building a road connecting the surrounding districts in October 2020 .
However, representatives of Vietracimex said the improved infrastructure has made no impact on the company’s property prices and surrounding projects. So far, the investor has not re-launched the project and listed the prices yet. The growing prices are merely made up by estate agents.
Some experts attributed the price hike to the supply scarcity. But they warned that the momentum persists with significant support by real estate agents, resulting in some concerns about “price bubbles” that might distort the market.
Nguyen Hong Van, JLL Vietnam’s Director of Markets, said Hanoi’s suburban districts of Dong Anh, Hoai Duc, Quoc Oai and Thach That have launched a number of big property projects following upgraded infrastructure.
The construction, together with advantages of hospitality real estate, has been a driving force for the property market in this region and the prices will definitely increase, Van forecast.
Giving explanation for the momentum, Nguyen Van Dinh, the vice chairman of Vietnam Association of Realtors (VARS), said the suburban districts are home to affordable segment that has maintained high occupancy, around 70%. The excess demand of land is also another reason, he noted.
“The prices in some areas have been pushed up. It becomes unreal for people’s affordability and has kept investors away due to high compensation and thin profits,” Kinh te & Do thi Newspaper quoted Mr. Dinh as saying.
Hanoi supports 900 firms in tracing origin of agricultural products
100% of products from 141 production and distribution chains of agro-forestry-fishery products in Hanoi, as well as 80.5% of fruit stores, are using QR code for origins tracing.
Districts in Hanoi such as Dong Anh and Chuong My, among others, have established their own QR code traceability systems that are based on the city’s platform known as the Agro – Forestry -Fishery and Food Traceability System (https://hn.check.net.vn/), jointly developed by the municipal Department of Agricultural and Rural Development (DARD) and the Enterprise Center for Integration and Development (IDE).
To date, the system has provided instruction and created accounts for 2,854 businesses, up 740 against that of 2018, including cooperatives, producers, and distributors of agricultural products, while issuing food safety logo for 766 fruit stores.
DARD has been tasked with raising the public awareness regarding origin tracing via QR code, in which over 20,000 leaflets providing instruction on the use of QR code have been distributed to producers, businesses and customers.
The department also supported Minh Khai wholesale market (Bac Tu Liem district) and the Southern wholesale market business center (Hoang Mai district) with 3,000 manuals on origins tracing.
The local authorities have organized 53 training classes for officials at districts, wards, businesses, producers and customers in Hanoi, on promoting IT application during the process of agricultural production and distribution.
During the 2018 – 2020 period, DARD has issued 8,702 QR codes for 635 enterprises in Hanoi and 238 in other cities and provinces.
This has ensured 100% of products from 141 production and distribution chains of agro-forestry-fishery products in Hanoi, as well as 80.5% of fruit stores, are using QR code for origins tracing.
Central Bank warns of illegal forex trading
Investments in forex trading platforms, seen as illegal, would not be protected by law, said a senior official of the central bank.
Credit institutions with permission from the State Bank of Vietnam (SBV) are the only ones allowed to provide foreign exchange (FX) trading and derivatives services on the domestic and international markets.
Investors should be cautious in participating in illegal forex trading platforms, said SBV’s Vice Governor Dao Minh Tu at a monthly government’s press briefing on December 2, referring to the case of growing numbers of such platforms are calling for investment with promises of soaring profit.
“So far, local authorities have not issued licence for any forex trading floor. Therefore, all transactions on these floors are illegal,” stressed Mr. Tu.
“Individuals investing in these platforms, seen as violating laws, would not be protected by law,” he noted.
Mr. Tu said during the Covid-19 crisis, legal businesses anywhere around the world could hardly guarantee profit of up to a couple of dozen percent, let alone promises for profit of hundreds of percent per year, which is a sign of fraud.
Vice Minister of Industry and Trade Do Thang Hai noted forex trading platforms in Vietnam are form of illegal multi-level marketing activities that pose high risks in terms of assets losses for investors.
“Those participating in these activities could be subject to a penalty of up to VND5 billion (US$217,500) or five-year jail term,” Mr. Hai stressed.
Some investors admitted greedy is a major reason for them to participate in forex trading activities. However, they argued a lack of legal framework regulating such activities has directly led to a growing number of such platforms operating publicly and attracting ill-informed investors.
Vietnam timber export makes record this year
The wood processing industry continues to be among top 10 key export categories in 2020.
Vietnam’s timber and forestry exports are expected to make a value of US$13 billion this year, surpassing the target thanks to the efforts of companies and support from the government agencies to overcome dificulties caused by Covid-19.
During January-November, export turnover from timber and wooden products reached US$12.6 billion, up 11.5% compared to 2019 and represented a trade surplus of US$10 billion in the whole year of 2020 according to the Ministry of Agriculture and Rural Development (MARD).
It is the fifth consecutive month that the sector’s export turnover continued to attain more than US$1 billion, contributing to make a record revenue this year.
Vietnam’s wooden products are exported to 140 countries and territories, mainly to key traditional markets such as the US, Japan, South Korea, EU and China.
Local enterprises have focused on expanding the scale of production, and improving management capacity and application of modern science and technology.
In 2019, Vietnam has over 5,539 enterprises and 340 craft villages involved in production and trade of timber and forest products. Among those, 4,873 enterprises are exporters of such products.
According to MARD Deputy Minister Ha Cong Tuan, Vietnam’s timber and wooden product exports represent only about 6% of the world market share, which is expected to expand along with the signing of a series of free trade agreements between Vietnam and other countries.
He was speaking at the conference on solutions to boost the production, processing and export of timber and wood products in the period 2021-2025 held on December 1 in the central province of Nghe An.
Tuan said the industry is expected to reach export revenue of US$14 billion-US14.5 billion next year, up 10-11% compared to 2020. It sets the goal of attaining an export value by 2025 of US$18 billion-US$20 billion.
RCEP offers greater flexibility for Vietnam in exercising rules of origin
Vietnamese exporters might find it easy to meet the required rules of origin for their products as a significant portion of its production input is sourced from China and South Korea.
One of the most important benefits from the Regional Comprehensive Economic Partnership (RCEP) for Vietnam over existing free trade agreements (FTAs) is that the former offers greater flexibility on the use of raw materials sourced from member countries, according to Viet Dragon Securities Company (VDSC).
Specifically, the RCEP does reduce complexity and compliance costs for Vietnamese exporters through a single rulebook that covers the other 14 RCEP markets, stated VDSC in its latest report.
Vietnamese exporters, thus, might find it easy to meet the required rules of origin for their products as a significant portion of its production input is sourced from China (textile products) and South Korea (tech products).
Nevertheless, the main goal of the RCEP is to merge the existing FTAs that ASEAN has with five other Asia-Pacific countries into a single framework. Therefore, the RCEP eliminates tariffs mainly for goods that already qualify for duty-free treatment under existing FTAs of Vietnam.
The benefit of accessing new market and tariff cuts may be limited for Vietnam, noted VDSC.
In addition, due to the similarities in export products of many member countries, the deal is expected to boost competition for Vietnamese producers. For example, China had no existing deal with Japan and South Korea, lower tariffs for Chinese products under RCEP might deteriorate the competitive advantages of Vietnamese products exporting to these markets. On the other hand, given a sizable trade deficit between Vietnam and China, reducing trade barriers further could lead to rising imports without an enough compensating access to the Chinese market.
The RCEP countries represented 42% of Vietnam’s total exports and 56% of foreign direct investment into the country (worth US$22 billion) in 2019. Despite some drawbacks of the deal, experience from other regional trade agreements and econometric models suggest that Vietnam could benefit from the RCEP.
A study from the World Bank in 2019 revealed the trade deal could increase Vietnam’s GDP by around 0.4% by 2030, with extra productivity gains, economic gains could be 1.0%.
The Peterson Institute for International Economics, a US think tank, estimated that Vietnam’s real income could be 0.5% higher by 2030 due to the impact of RCEP. Meanwhile, according to the Ministry of Industry & Trade estimation, the RCEP could yield economic gains of 0.7% of GDP by 2030.
Following the signing of the deal, RCEP members must first ratify the agreement and the trade deal is expected to come into force either in late 2021 or early 2022.
With the participation of China, South Korea, Japan, Australia, New Zealand and 10 ASEAN countries, the RCEP would cover a market of 2.2 billion people, or almost 30% of the world’s population, and a combined GDP of US$26.2 trillion or about 30% of global GDP, and accounts for nearly 28% of global trade (based on 2019 figures).
The deal, however, does not include India, which dropped out of the negotiation process in November 2019.
HCM City’s industrial production index up 3.4 percent in November
The November index of industrial production (IIP) in Ho Chi Minh City picked up 3.4 percent compared to the previous months, but the index for the January-November period fell 4.4 percent year on year.
According to the municipal Department of Industry and Trade, the 11-month IIP of the four key industries of manufacturing, electronics, chemicals-rubber-plastic and food processing posted a year-on-year increase of 0.4 percent.
Notably, significant hikes were seen in the electronics and chemicals industries with 19.8 percent and 5.2 percent, respectively.
The consumption index of processing and manufacturing industries in the last 11 months was down 2.3 percent compared to the same period in 2019, the department said.
Vice Director of the Department Nguyen Phuong Dong said local enterprises still faces difficulties when major trading partners have not opened their doors due to the COVID-19.
Meanwhile, the municipal Department of Statistics reported that in the first 11 months, the city’s export-import turnover increased by 1.1 percent year-on-year.
Foreign-invested area is considered the key contributor to the city’s export-import growth, with its export and import turnovers surging by 10.7 percent and 7.6 percent, respectively.
China remained the largest market for HCM City enterprises, buying over 9.7 billion USD worth of goods from the city in the period, up 28.1 percent./.
Thai conglomerate values potential of Vietnamese market
Thai conglomerate B.Grimm Group is studying the feasibility of an additional 3,000MW in Vietnam and a partnership with a US firm for 2,000MW of supply, according to B.Grimm chairman Harald Link.
Bangkok Post newspaper quoted Link as saying that Vietnam is a high potential market and B.Grimm is the largest power operator in the country and has projects from 1,000-3,000MW in the pipeline. The firm has also received a licence to import 650,000 tonnes of LNG annually from Vietnam.
B.Grimm operates power businesses in Thailand, Laos and Vietnam, with a transmission system in Cambodia. It has a total capacity in operation of 3,019 MW supplied from co-generation, solar, energy storage backup for power trading and waste to energy.
The company also has 1,200MW worth of projects in development, which include 16MW of wind power and 95MW of hydropower.
B.Grimm recently signed deals for an additional 3,000MW of liquid natural gas (LNG) projects.
Link said B.Grimm Group’s power business will be a key driver of revenue over the next eight years, aiming to reach total revenue of 150 billion baht (about 5 billion USD) by 2028.
This year, 70 percent of the group’s total projected revenue of 60 billion baht came from its energy arm B.Grimm Power Plc, which is listed in the Stock Exchange of Thailand./.
Kien Giang secures over 15.38 billion USD in tourism projects
More than 355.6 trillion VND (15.38 billion USD) had been injected into 323 tourism projects in the Mekong Delta province of Kien Giang as of November this year, according to the provincial Department of Tourism.
Of the total, Phu Quoc island alone attracted 279 projects valued at over 349.7 trillion VND.
According to director of the tourism department Tran Chi Dung, 69 new projects, which are already operational now, have helped cast a new look to the local tourism and serve as a locomotive to boost sustainable development of the tourism industry.
Local authorities always create favourable conditions for investors to complete procedures so as to put forth construction of tourism infrastructure, he added.
The province aims to welcome 7 million tourists, including 400,000 foreigners, and targets 11.5 trillion VND in tourism revenue in 2021, up 46 percent year-on-year.
Dung said the tourism sector will join hands with competent agencies to enhance state management in tourism coupled with COVID-19 prevention work.
Due attention will be given to tourism promotion activities, human resources quality improvement, development of standout and competitive tourism products, and tourism development in tandem with environmental protection, among others.
In 2020, COVID-19 has cost the local tourism sector 12.2 trillion VND, with the closure of 320 lodging facilities and temporary suspension of operation of 15 travel establishments. Besides, the pandemic stole jobs of over 6,400 workhands in the sector./.
Clear policies needed to attract foreign investment in agricultural sector
Foreign direct investment in Vietnam’s agriculture sector remains limited despite the industry’s enormous potential.
Wide-ranging measures that would attract more investment and help modernise the sector are needed, delegates said at a seminar held in HCM City on December 3.
Nguyen Thi Hong Thanh from the Information Centre for Agriculture and Rural Development under the Institute or Policy for Agriculture and Rural Development, said: “As of December last year, FDI in the agricultural sector remained modest, accounting for just 1.61 percent of the total number of FDI projects and 0.97 percent of total FDI capital into Vietnam.”
Taiwan, the Virgin Islands, Singapore and Thailand are among the largest foreign investors in the field, she said, adding that foreign investors have mainly invested in cultivation, animal husbandry, forestry, aquaculture, and agricultural production and services.
Foreign investment in the sector has brought technology transfer and new production models that have improved added value and competitiveness of Vietnamese products. It has also helped to create more jobs and improve infrastructure in rural areas, and enabled the sector to directly connect to global value chains.
But foreign investors have mainly invested in some localities and sub-sectors mostly because of difficulties in accessing land to develop a stable source of materials and limited logistics services and infrastructure, she said.
Vu Xuan Dang, deputy director of the Southern Investment Promotion Agency, said there is not a large land fund for agricultural production in many localities, and some localities with large land funds give priority to industrial parks.
Nguyen Huu Nam, deputy director of the Vietnam Chamber of Commerce and Industry – HCM City branch, said that with the small scale of agricultural land, it will be difficult to develop concentrated production areas and apply advanced technology and machines. As a result, post-harvest losses are high, which adversely affects foreign investment.
Nguyen Anh Phong, director of the Information Centre for Agriculture and Rural Development, said that foreign investors in agriculture have complained about access to information related to land-use planning and the quality of public services.
Le Minh Thuy Trang from Eurocham agreed, saying that administrative procedures are the top concern of foreign investors.
The Government has policies to attract foreign investors, including corporate tax and land rental incentives, but the policies should clearly state the incentive rates, she said.
Delegates at the seminar also discussed measures to lure more foreign investors to the sector in the coming time.
Phong said the country should prioritise foreign investment in the sectors and products that have comparative advantages, high added-value, and potential for market expansion. Those using advanced and environmentally-friendly technology should also be a priority.
Improving the investment environment and reforming policies related to land and taxes are also needed, as well as upgrading infrastructure and training human resources in rural areas, he added.
Dang said the country needs to “create more favorable conditions for foreign investors, including policies to encourage the development of concentrated animal husbandry areas and material zones, large-scale fields, and high-tech agricultural zones.”
In addition, the Government should increase investment in infrastructure development in the northern mountainous region, the Central Highlands, and the Mekong River Delta region, which all have localities with high potential for agricultural development.
Improving the quality of local human resources to meet agricultural development in the 4.0 industry era is also a must, he added./.
Registered capital of new enterprises surge
As Vietnam is pursuing the twin targets of disease prevention and economic development, the number of new enterprises and those resuming operation has bounced back in recent months.
According to the General Statistics Office (GSO), the number of the newly-established firms in November rose by 7.3 percent month-on-month and 6.7 percent year-on-year, while that of the firms reopened increased by 5.4 percent m-o-m and 59.8 percent y-o-y.
Of note, the overall capital of new enterprises last month jumped 72 percent against that of the previous month and 103.5 percent against the same month of last year.
In the first 11 months of 2020, Vietnam reported nearly 124,300 newly-established enterprises which register a combined capital of 1.878 quadrillion VND (81 billion USD) and employ 970,000 labourers in total, down 1.9 percent in the number of firms, up 19.3 percent in registered capital, and down 14.7 percent in the number of employees year-on-year.
In the period, 40,800 businesses resumed operations, up 10.7 percent year-on-year.
However, nearly 93,500 enterprises halted their operation in the period.
Head of the GSO Industrial and Construction Statistical Department Pham Dinh Thuy advised enterprises to find more business partners, solve difficulties and promote the efficiency of their investments.
He proposed issuing policies encouraging or limiting the import of several commodities in accordance with the domestic production situation and demand./.
Symposium seeks ways to conserve, develop heritage tourism amid COVID-19
The People’s Committee of the central province of Quang Nam held a symposium on December 3 to identify challenges and solutions on heritage tourism conservation and development amid COVID-19.
It was part of the activities marking the 21st anniversary the province’s Hoi An Ancient Town’s recognition as a UNESCO World Heritage (December 4), and the third year the art of Bai Choi in central Vietnam was inscribed on the Representative List of the Intangible Cultural Heritage of Humanity (December 7).
Many studies and essays were delivered at the event, particularly those on experience in heritage tourism conservation and development in the ancient villages of Duong Lam in Hanoi and Dong Hoa Hiep in Tien Giang Mekong Delta province, which could be applicable in Hoi An.
Representative of the Japan International Cooperation Agency (JICA) in Vietnam Mori Yoshinori briefed the delegates on the cooperation and incentives of JICA in cultural conservation and tourism development in Vietnam in general and Hoi An in particular via research programmes on history, archaeology, architecture, relic preservation, and capacity raising for those working in such fields in the localities.
Hoi An is known as the largest trading port in the central region of Vietnam in the 17th century. At present, the ancient town has a total of 1,438 relics, including 28 historic and 1,336 architectural ones.
Seventy percent of proceeds collected at tourist destinations has been earmarked for the infrastructure reparation and investment in the town, as well as research and the holding of festivals.
As the ravaging pandemic has dealt a blow to tourism activities in Hoi An, only 150 relics are open to the public. The event, therefore, also discussed measures to lure visitors once COVID-19 is repelled.
Tourism arrivals to Hoi An stood merely stood at 841,000 in the first nine months of this year and the tourism sector raked in over 772 billion VND (33.41 million USD), marking a nosedive of 80 percent against the same period last year./.
Dragon Capital no longer a major shareholder in Military Bank
A group of investment funds run by Dragon Capital announced Monday it has sold one million shares of Military Bank (MBB), reducing their ownership from 5 per cent to 4.97 per cent and is no longer a major shareholder of the Bank.
The transaction was conducted on December 2.
In the first nine months of this year, MBB recorded total revenue of VND19.65 trillion (US$845 million), up by 9.4 per cent year-on-year.
Pre-tax profit totaled VND8.1 trillion and after-tax profit reached VND6.6 trillion, up 6.8 per cent and 7.4 per cent against last year, respectively.
In 2020, MBB plans to earn pre-tax profit of VND9.03 trillion, down 10 per cent compared to 2019. However, under favourable market conditions, the Bank will adjust the pre-tax profit plan higher to reach VND10 trillion, equivalent to 2019.
As of September 30, MBB’s total assets increased by 4 per cent compared to the beginning of the year, at VND421 trillion. In which, customer loans increased by 7 per cent while provision for loans increased by 50 per cent.
Regarding capital, MBB recorded a slight decrease of 1.3 per cent in customer deposits compared to the beginning of the year.
In terms of loan quality, the bank has a total VND4 trillion in bad debts, an increase of 39 per cent compared to the beginning of the year.
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