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People work at an auto plant. The improvement in Vietnam’s manufacturing sector in April 2021 was the strongest since November 2018 – PHOTO: VNA

New orders rose at a sharper rate, with firms responding by upping their rate of job creation and ramping up purchasing.

Input costs continued to rise sharply, leading to the fastest increase in selling prices in nearly a decade. Meanwhile, there were some signs that supply-chain disruption had started to ease during the month.

The Vietnam Manufacturing Purchasing Managers’ Index (PMI) increased for the third straight month, posting 54.7 in April following a reading of 53.6 in March. The manufacturing sector was boosted in April by signs that customers were willing to commit to larger orders than they previously did, given the general improvement in demand and control of the Covid-19 pandemic.

The total new orders increased for the eighth straight month running and at the fastest pace in close to two and a half years.

New export orders also continued to rise amid an improving international demand climate. Higher new orders led to a similarly-sized expansion of manufacturing output, with production also up at the fastest pace since November 2018.

Companies boosted production by increasing workforce numbers. Staffing levels were expanded for the third month running and to the greatest extent since December 2018.

This increased capacity, however, was not sufficient to prevent a first rise in backlogs of work in 15 months due to the strength of new order growth.

Besides raising staffing levels, firms also posted a sharp and accelerated expansion of purchasing activity. Respondents indicated that the increase in input buying was both in response to higher new orders and as part of efforts to build reserves to support production growth in the months ahead.

Efforts to expand inventory holdings were generally successful in April, with both stocks of purchases and finished goods increasing. In both cases, the rate of accumulation was solid and faster than at the end of the first quarter.

There were some signs that recent severe disruption to supply chains eased in April. While suppliers’ delivery times continued to lengthen, the latest deterioration in vendor performance was modest and the softest since last September.

Supply shortages and rising shipping costs continued to feed through to higher input prices. The rate of cost inflation remained substantial and was only slightly slower than that seen in March. In turn, firms raised their selling prices sharply, with the rate of inflation quickening to the fastest for close to a decade.

Expectations that the pandemic will remain under control led to higher demand, and the introduction of new product lines, supported ongoing confidence among firms regarding the 12-month outlook for production.

“The Vietnamese manufacturing sector hit the ground running at the start of the second quarter. Output and new orders each rose to the greatest extent since late 2018, and there were encouraging reports that customers were often happy to place larger orders amid greater confidence in the sustainability of the current expansion,” said Andrew Harker, economics director at IHS Markit.

“Inflationary pressures remained elevated, with output prices increasing at the fastest pace for almost a decade. There were some signs, however, that the severity of the difficulties in supply chains may be easing, which will hopefully reduce some of the upward pressure on prices,” Harker added.

Binh Phuoc seeks to bolster investment from US

The Becamex IDC Corporation together with the People’s Committee of southern Binh Phuoc province held an online conference on May 5 with investors from the US.

Addressing the gathering, Vice Chairman of the provincial People’s Committee Huynh Anh Minh said trade and investment promotions remain restricted as the COVID-19 pandemic wreaks havoc across the world.

The conference, therefore, holds significant and practical meaning for Binh Phuoc and the US business community and affirms the province’s determination to expand cooperation and attract investment and the attention from US firms.

Binh Phuoc hopes to bolster cooperation with US investors in the fields of industrial engineering, electromechanics, the agricultural processing industry, supporting industries, and high-tech agriculture, among others, he said.

He also pledged that Binh Phuoc will improve its investment climate to ensure transparency, revise policies, and create favourable conditions for businesses operating in the province.

At the conference, Vietnamese Ambassador to the US Ha Kim Ngoc underlined that the US is among Vietnam’s leading trade partners, with bilateral economic and trade cooperation maintaining growth levels despite the adverse impact of COVID-19.

Binh Phuoc is currently home to 13 industrial parks (IPs) covering 4,686 ha. To satisfy economic development demand and attract investment in the 2021-2030 period, the province eyes the expansion of three IPs and the establishment of four others, raising the total area to 10,000 ha.

Prominent among these will be the Becamex – Binh Phuoc Industrial and Urban Complex in Chon Thanh district, which has drawn 49 projects with registered capital of nearly 1 billion USD.

Becamex Binh Phuoc is set to build the 1,000-ha Dong Phu Urban IP in the time to come./.

115 trillion VND for tax payment extension

The total value of taxes and land lease fees under the Government’s recently-issued decree on the extension of deadlines for tax payment is 115 trillion VND (4.97 billion USD), heard a press conference of the Government on May 5.

Minister-Chairman of the Government Office Tran Van Son said Decree No. 52/2021/ND-CP aims to support enterprises, organisations, family businesses and individuals who are affected by the COVID-19 pandemic.

Under the Decree, a five-month extension will be given to value-added tax of the assessment periods of March, April, May, June, the first quarter and the second quarter this year. This means the payment of VAT of March assessment period will be extended to September.

Timeframe for payment of value-added tax of July and August will be extended by four and three months, respectively.

Payment of corporate income tax in the first and second quarters will be extended by three months, according to the Decree.

A six-month extension will be given to payment of land rent fees, starting from May 31, 2021.

This is the third time the Government has introduced tax and land rent payment deadlines since the first COVID-19 cases reported in Vietnam on January 23, 2020.

Earlier, the Government promulgated Decree No. 41/2020/ND-CP dated April 8, 2020 on extension of deadlines for tax and land rent fee payment and Decree No. 109/2020/ND-CP providing the extension of time limits for excise tax payment for domestically manufactured or assembled cars.

In implementing the two previous Decrees, a total of 184,900 dossiers on tax and land lease payment extension were passed with a total sum of 87.3 trillion VND./.

Capital injections loom in finance M&A

Although the pandemic is still taking a serious toll on the economy, foreign investors are banking on cross-border mergers and acquisitions in the financial industry, especially in consumer finance and retail banking, illustrating the urgency to acquire new capabilities.

Japanese financial group Sumitomo Mitsui Financial Group (SMFG) – parent of Sumitomo Mitsui Banking Corporation (SMBC) and consumer arm SMBCCF – was last week reportedly to acquire 49 per cent in FE Credit, Vietnam’s largest consumer finance company under VPBank.

Deputy Prime Minister Pham Binh Minh told Masahiro Yoshimura, general manager of Business Development Department at SMFG, at a reception last week that he welcomed SMBC’s investment in FE Credit, and noted his belief that the cooperation will be a success.

SMFG will pay $1.4 billion to buy 49 per cent at FE Credit, making it the largest deal conducted by a Japanese bank in Vietnam’s financial institution landscape. “The looming acquisition comes as Vietnam’s consumer loan market rapidly expands on the back of strong and sustained economic growth,” reported Nikkei Asia. “Sumitomo is aiming to widen its business in Asia by leveraging its digitalisation and customer management expertise.” FE Credit, after the deal, is now valued at $2.8 billion.

A representative of VPBank told VIR, “Through this transaction, FE Credit is expected to receive additional support and international expertise in capital resources, as well as management skills from SMFG, especially from SMBCCF.

“At the same time, this transaction will inject a large amount of capital to VPBank, bolstering the bank’s solid growth fundamentals and enhancing its financial capabilities to explore its huge potential as well as capitalise on the emerging financial industry in Vietnam,” the representative added.

VPBank’s Board of Directors initially forecast that a successful initial public offering could triple FE Credit’s share price compared to the book value after equitisation.

The $1.4 billion bet on FE Credit is part of SMFG’s strategy to increase its footprint in Asia. The mega deal will offer mutual benefits, where the Japanese lender fund could jump on the lucrative consumer finance bandwagon in Vietnam, and FE Credit could enhance its operations to international standards.

SMBC Group is one of the three biggest banking and financial groups in Japan, with total assets of over $2.1 trillion as of December 31 last year. The group operates in retail banking, corporate banking, and investment banking worldwide, and is present in over 40 countries.

Last December, SMFG was allegedly planning to acquire an Asian lender, specifically in Vietnam, the Philippines, and India. Accordingly, the bank would cooperate with a global investment bank on US deal-making activities.

Elsewhere, international banks including DBS Group, Mitsubishi UFJ Financial Group, OCBC, and Standard Chartered are allegedly vying to each other to buy Citibank’s retail banking business in Asia after the latter’s announcement to shut down this arm in 13 markets a fortnight ago.

“The sale process will start within a couple of weeks, they added, declining to be named as they were not authorised to speak to media. Potential bids from the regional banks and Standard Chartered, which makes most of its profit in Asia, underscores their growing appetite for businesses like credit cards and mortgages in a push to lock in long-term income growth,” Reuters noted.

“Asia is critical to our group’s strategy, and we will allocate resources to drive profitable growth,” a Citi spokesman in Hong Kong said.

At the same time, Japanese banks MUFG and Sumitomo Mitsui Financial Group, along with Brit-based Standard Chartered, are mentioned as other potential bidders. In South Korea, financial institutions OK Financial Group and DGB Financial Group are strong candidates if a bidding war to acquire Citibank’s retail subsidiary takes place.

Specifically, DBS – the Singaporean multinational banking and financial services corporation – is reportedly mulling over buying Citibank’s retail business in India, according to The Hindu Times.

“DBS has always been open to exploring sensible bolt-on opportunities in markets where we have a consumer banking franchise and where we can overlay our digital capabilities,” DBS said in a statement.

Besides DBS, Standard Chartered and Kotak Mahindra Bank and Axis Bank also show their interest in the deal in India. Meanwhile, Bloomberg reported the Bank of the Philippines – the country’s oldest lender – is mulling over acquiring Citibank’s retail arm domestically.

“We have told them that as soon as there is any information, we will take a look at it and most likely, we will be interested,” the bank’s president TG Limcaoco said, referring to Citigroup’s retail banking business.

In Vietnam, Citibank has been one of the most prestigious foreign lenders for years, providing a wide range of services from credit cards to wealth management, among others.

Citibank’s representative in Vietnam previously said that the withdrawal will not affect to its long-term commitment in this country. Citigroup’s consumer banking business in 13 markets made up for $4.2 billion of the bank’s revenue in 2020 of $74.3 billion.

Developers work around foreign cap

To meet the increasing demands of non-nationals on owning a property in Vietnam, many real estate developers are moving such buyers towards a long-lease term of 50 years instead after using up their restriction of 30 per cent of foreign ownership per project.

In the event of an area with geographical boundary equivalent to ward level with many apartment buildings for sale or lease purchase, those organisations and individuals may own no more than 30 per cent of the total units of each apartment building, and not more than 30 per cent of the total units of all the apartments.

Some projects, however, have used up the limitation such as Gateway Thao Dien, Nassim, and Thao Dien Pearl. In response, the project developers are persuading their overseas buyers to a long-lease term of 50 years instead.

According to Le Hoang Chau, chairman of Ho Chi Minh City Real Estate Association (HoREA), in several projects that that reached the ownership rate ceiling, non-nationals are being offered two options for short-term rent or long-term home lease. “In reality, there is not much difference between being in or out of the 30 per cent limitation. Foreign buyers who are consistent in wanting a property in their target projects will choose the long-lease term,” Chau said.

While current regulations include the 30 per cent cap for foreign ownership in Vietnam, no such limitation is applied for long leasing.

Some nations are currently tightening foreign ownership policy to avoid speculation, like South Korea, or trying to limit the number of homes being bought by foreigners, causing prices to soar and making it difficult for local middle- and low-income people to acquire accommodation, like in Australia.

Chau stressed that housing needs and housing ownership are different. “Most of the foreigners living in Vietnam would choose to rent a house instead of buying. This is because if they stay in Vietnam for more than 180 days each year will have to pay personal income tax. They will not buy fixed assets and then waste half a year of not using them,” Chau said.

Keeping the limitation of 30 per cent does not affect the target of attracting foreign investment while ensuring the advantage for Vietnamese in the luxury segment, he added.

According to unofficial figures, more than 320,000 foreigners live and work in Vietnam, mainly in Hanoi and Ho Chi Minh City.

Ho Chi Minh City has recorded the highest percentage of foreign buyers nationwide. According to HoREA, 17 leading real estate groups and corporations in Vietnam have sold more than 12,000 homes to foreign individuals and enterprises during the past five years.

The majority of overseas buyers come from China, South Korea, Taiwan, Hong Kong, and Singapore, while leasers are mainly from Europe, the US, Australia, and Japan. Nationwide, the HoREA predicts that around 16,000 units have been sold to non-Vietnamese buyers during this time.

Among the 17 real estate groups, 85 per cent of the total units belong to five leading ones with more than 10,000 units. Of those, Vingroup occupies around 40 per cent, with more than 5,000 units sold to foreigners.

Figures from the Ministry of Construction said that more than 4 million units were built in Vietnam in the last 10 years.

Under Decree No.99/2015/ND-CP to guide to the implementation of Law on Land 2013, the ministries of defence, public security, and construction work with local authorities to set up a list of projects eligible for foreign buyers. Developers must propose those projects and meet the required conditions so as to not harm national security.

However, many localities have not released their list of eligible projects for them, causing a prolonged process in handing out red books for buyer certification.

Only localities such as Hanoi, Ho Chi Minh City, Binh Duong, Khanh Hoa, Danang, and Ba Ria-Vung Tau have offered up lists so far.

“This slow process is confusing and brings risks to buyers if they bought a project but has not had it permitted yet,” said Nguyen Van Minh, a consultant in Ho Chi Minh City’s District 4.

Beer battle ahead shakes up goals

The country’s biggest brewers, SABECO and HABECO, have been quizzed over their ambitious profit targets and possible solutions at their annual general shareholders’ meetings as tough competition and beer consumption figures stand in their way.

Although domestic brewers have been faced with social restrictions during the pandemic and stricter regulations on road traffic to keep beer lovers safer, this year’s revenues and net profit targets show an attempted direction towards economic recovery.

The publicly-listed Hanoi Beer, Alcohol, and Beverage JSC, or HABECO (code BHN), approved its business plan at last month’s annual general shareholders’ meeting. Revenues from its main product lines of beer and UniAqua water was presented, reaching VND5.3 trillion ($230.4 million), while profits after tax amounted to VND225.4 billion ($9.8 million), down 8.5 per cent and 59.2 per cent on-year, respectively.

Although the beermaker holds the largest market share in the north, HABECO predicted that its business situation this year will still face many difficulties as the global fight against the pandemic persists.

In the context of the generally weak demand due to lowered consumers’ purchasing power, HABECO also must deal with pressure from competitors that are concentrating large resources on continuous promotions, investing heavily in their distribution systems, and bringing new products to the market that directly compete with popular segments of the company.

Ngo Que Lam, general director of HABECO, said that in the northern and north-central regions, which are the company’s main markets, the beer industry has experienced a stronger decline compared to other markets.

Despite being subject to stiff competition from international and local beer brands, HABECO however still maintains its position as the leading brewer in the market and recovered its business in the summer season and by the end of 2020 as a whole.

According to a report conducted by SSI Securities Corporation, the beer sector’s recovery momentum will continue but the demand is forecasted to not return to pre-pandemic levels before 2022.

Although Vietnam has handled the pandemic well, with catering and entertainment improving, the overall performance of the food and beverage sector is still a long way off pre-pandemic levels, and customer frequentation at restaurants, cafes, shopping centres, theme parks, and museums remains weak, representing an overall decrease of 10 per cent compared to the average rates.

Meanwhile, SABECO (code SAB) set a target revenue of VND33.5 trillion ($1.33 billion) with net profits of VND5.2 trillion ($208 million) for 2021, a 20 per cent and 7 per cent on-year increase, respectively.

Explaining the figures, Bennett Neo, general director of SABECO shared, “Our business plan for 2021 was made in January, but the goal of increasing sales by 20 per cent is not easy. Even so, the Management Board still maintains its commitment and strives to fulfil it.”

Despite the challenges from the pandemic, new regulations, and natural calamities last year, SABECO was able to post better-than-expected bottom-line results by implementing cost savings, leveraging new sales opportunities, and expanding the market by introducing new brands such as Lac Viet and Saigon Chill. With this, SABECO has also been able to meet its previously-approved 2020 dividend plan which maintained a rate of 35 per cent.

At the company’s presentation of its 2020 financial results, SABECO highlighted that while revenues and profit after tax went down 26 per cent and 8 per cent from the previous year, respectively, SABECO still managed to surpass its targets by 17 per cent and 52 per cent, respectively. In absolute figures, SABECO exceeded its revenue target by VND4.1 trillion ($178.2 million) and its net profit goal by VND1.6 trillion ($69.6 million).

“We were able to weather headwinds in 2020 by remaining fiscally prudent and operationally nimble,” said Neo. “We focused our spending on the essentials and continued to find efficiencies, where possible, while making sure that we are able to leverage on market opportunities.”

The spirit of accepting tough trials is rooted in the company’s transformation strategy that started three years ago after Thai Beverage acquired a majority stake in the state-owned brewer.

Both SABECO and HABECO showed solutions to shareholders to reach their targets, including improving the distribution network and adjustments to customer tastes, resulting in a larger market share.

Although the beer sector faced the dual pressure of the pandemic and regulations on drink-driving last year, the newly-introduced product lines could be utilised to increase market share as Vietnamese consumers begin to pay more attention to such products thanks to quality and taste, and thus are more willing to pay higher prices.

Pushing agricultural product consumption through e-commerce

A number of localities in Son La province have recently supported agricultural product consumption via social networks and e-commerce sites. The move has brought initially positive results compared to traditional methods of consumption.

One hour of livestreaming attracted more than 500,000 views, and after two days the number had increased to more than 3 million, with a total of 20 tonnes of plums sold. Online sales have contributed to promoting the Tam Hoa plum brand among many more people throughout the entire country.

Tam Hoa plums are a high yield crop, and in recent years there have been many localities planting the variety as their main crop. But due to a lack of communications and promotional efforts, they were still mostly consumed locally or in neighbouring areas. To remove the obstacles, the local government established a campaign committee to support the promotion and consumption of plums and of agricultural products in general through social networks and e-commerce sites.

Selling goods online and through e-commerce sites has many benefits, but quality must be ensured when products reach consumers. In order to guarantee the fair sale and uniform quality of agricultural products, authorities at all levels in Son La have created specific lists, giving priority to households that do not use fertilisers or chemical pesticides in the growing process./.

Questions over air titans’ funding plans

While Vietnamese airlines are looking at  fundraising on the stock market as a way to shelter from financial storms, the possibilities of making it a success remain narrow.

According to Pham The Anh, chief economist at the Vietnam Institute for Economic and Policy Research, airlines plan fundraising on the stock market as favourable conditions in the stock market are in reach. This may therefore be a good solution for them to access more financial sources for operations amid the pandemic.

However, many experts warn that it will not be easy for air carriers to mobilise tens of trillions of VND in the stock market at this time because their tickers are simply less attractive than others.

In a specific case, the Ho Chi Minh City Stock Exchange decided to issue warnings to HVN, the ticker of Vietnam Airlines, from April 15 due to business losses. An expert at FPT Securities told VIR, “HVN has fallen in recent days due to serious concerns over COVID-19.”

Also, VJC – the ticker of Vietjet – also saw a downtrend from over $5.66 per share on April 22 and $5.53 on April 27 to $5.47 on April 28.

Bamboo Airways is currently selecting an international auditing company to prepare for its initial public offering (IPO) in the United States, planned for the third quarter.

Chairman Trinh Van Quyet, also the chairman of private-run property developer FLC Group, said that the airline aims to raise $200 million in the IPO by offering 5-7 per cent of stake at a starting price of VND60,000-80,000 per share ($2.60-3.47), thus increasing its market capitalisation to $4 billion.

“The IPO in the US is part of Bamboo Airways’ efforts to expand its services globally,” Quyet said. “This is the latest development of the airline and the IPO on a local stock exchange is a backup plan, depending on market conditions.”

In similar moves, Vietjet offered nearly 18 million treasury shares on the Ho Chi Minh Stock Exchange from March 30 to April 28 to increase its working capital. Elsewhere, national flag carrier Vietnam Airlines, in which the state holds 86 per cent, has received government approval to issue additional shares worth VND8 trillion ($348 million) regardless of the issuance schedule.

Together with issuance plans, airlines are seeking government support policies on loans after Vietnam Airlines earlier received refinancing loans worth VND4 trillion ($174 million) with interest rates for refinancing loans set at zero per year.

Specifically, Vietjet seeks a loan of VND4-5 trillion ($174-217 million) with a term extending to 2023 and lending rate of 4 per cent annually. In the meantime, Bamboo Airways also seeks a loan of VND10 trillion ($435 million).

While Anh said that the government should have similar credit supporting policies for airlines to ensure equal treatment, others suggested careful consideration to ensure fair treatment, as aviation is not the only sector badly hit by COVID-19.

As a result of the uncertainty, airline expansion and restructuring plans are inevitably placed on the back-burner. Market analysts forecast that the struggling sector will start recovering at the end of this year, with expectations pinned on regular international flights for those with “vaccine passports”. But numerous obstacles abound in terms of adequacy of evidence, effectiveness, technology, and vaccine efficacy.

Vietnam emerges as top alternative for global supply chain shift

The number of US-based companies seeing Vietnam as a top sourcing market has doubled over the past four years as a result of the global investment relocation trend from China.

Hong Kong-based QIMA specialised in providing supply chain compliance solutions has just released a survey of over 700 companies across the globe. Of this, the number of US-based respondents selecting the Southeast Asian country as the leading sourcing location has doubled against four years ago, to 43 per cent in early 2021.

Similarly, 25 per cent of EU companies also listed Vietnam as one of the three leading sourcing markets in this year’s first quarter, down 15 per cent on-year but up 11 per cent against the same period of 2019.

Of all establishments switching to suppliers in new geographic regions last year to avoid COVID-19 impacts, nearly one-third revealed that the 100-million population country is one of their best options. For US-based business, the rate was even higher, at 40 per cent.

QIMA also forecast the trend to continue this year. Of the companies asked for finding new suppliers over the next 12 months, 38 per cent of US-based establishments and 28 per cent of those from the EU stated that they are planning to relocate some sourcing to Vietnam or buy more from current suppliers there. On the other hand, only 6 per cent of US-based brands and 11 per cent of those from the EU were looking for suppliers in China.

Also, US-based respondents showed some signs of dissatisfaction with Chinese sourcing. While one-third of them are planning to purchase more from Chinese suppliers in 2021, almost as many reported plans to completely stop buying from the market.

Nevertheless, words and actions often differ. Pointedly, in the survey, 73 per cent of companies said they had plans to look for new suppliers in 2020 but only 38 per cent were able to follow through on those schemes. For brands headquartered in the US, 93 per cent declared to diversify supply chains in early 2020 but only 49 per cent carried out these plans.

Indonesia speeds up foreign investment appeal with Vietnam and Singapore

Indonesia is stepping on the gas in the race for foreign investment with Vietnam and Singapore, with new incentives targeting the production of electric vehicles and batteries.

To compete with Vietnam and Singapore, Indonesia is offering plenty of made-to-measure inducements, including the latest programmes accepting carbon offset, according to Bloomberg newswire.

The 270 million population country is reviewing its carbon-offset programmes to promote investment. The Indonesia Investment Coordinating Board is drawing up a list of peatlands which can store huge volumes of CO2 emissions, and also artificial lakes that could house solar panels, according to Nurul Ichwan, deputy chairman for Investment Planning at the Indonesia Investment Coordinating Board.

Bloomberg stated that the moves aimed to lure in electric vehicle and battery makers who want to source nickel from the country.

The Indonesian government has attempted to attract South Korea-based LG Chem that is present in Vietnam, China-based battery manufacturer Amperex Technology, and US-based electric car maker Tesla to set up shop in the country.

Ichwan said that Vietnam and Singapore offer similar incentives for overseas investors, however, Indonesia will draw in many big investment projects on account of its natural resources, large market, economic efficiency, and the directions of the country’s government.

The Indonesian administration late last year approved the Omnibus Law creating jobs for labourers in the nation. Accordingly, the law favours foreign investors pouring in large capital to develop industries, said Ichwan.

Similar to Vietnam, Indonesia has found that its traditional growth engines have all seen a downturn during the COVID-19 pandemic and the country is looking for investment into more modern industries such as manufacturing electric vehicles and batteries.

The competition for foreign capital has been heating up in Southeast Asia like Vietnam, Thailand and the Philippines which are all lowering tax rates and rolling out other incentives for foreign companies. As a result, Indonesia – the region’s largest economy – has accelerated policy reforms to encourage investment for years now.

The efforts have been paying off: in 2020, the country received Rp826 trillion ($57.2 billion) in total investment capital, up 2 per cent on-year. This is a positive sign as the nation has experienced the first recession over two decades due to the pandemic. Indonesian government targets to get Rp900 trillion ($62.5 billion) in investment this year.

Southern provinces brace for high temperature

The Hydrometeorological Forecasting Center for Southern Region stated that the southern provinces will witness hot weather throughout May, with temperatures expecting to reach 35 degrees Celsius or even higher.

May 4 was a sunny day for many areas within the Southern region as the Eastern provinces and some areas in the Western provinces experienced hot weather, with the temperature oscillating between 35 and 36 degrees Celsius at 1.00 p.m.

Throughout May 5, most southern provinces will experience sunny weather, which will gradually intensify in the afternoon, the local media reported.

The intensity of the heat in the Southern region will decline as the areas affected by the hot weather will narrow down compared to yesterday.

The highest temperature for today is predicted to oscillate between 33 and 35 degrees Celsius, with some places experiencing temperature over 35 degrees Celsius. Convective clouds are likely to develop gradually, causing thunderstorms at approximately one third of the affected area, while local areas will have moderate to heavy rain in certain areas.

Vietnam identifies three locally-infected cases of Indian coronavirus variant

Three locally-transmitted Covid-19 cases linked to Sunny Club in Vinh Phuc Province have been found infected with the Indian coronavirus variant.

The Ministry of Health today, May 4, released the results of a genetic analysis of the virus from the locally-infected cases which have been reported recently in Vinh Phuc, Ha Nam, Hung Yen and Ha Tinh provinces.

Three samples of three employees of Sunny Club in Vinh Phuc Province tested positive for the Indian variant, while six samples in Ha Nam, two samples in Hung Yen and two others in Ha Tinh came out positive for the UK coronavirus variant.

On May 2 and 3, Vinh Phuc Province reported 14 community-transmitted Covid-19 cases related to Sunny Club, which were suspected to have caught the virus from Chinese experts. After these Chinese experts completed their quarantine period at the same quarantine facility as a group of Indian experts in Yen Bai Province, they travelled to Vinh Phuc Province.

The Indian coronavirus variant is said to be more transmissible than others and reduce the efficacy of Covid-19 vaccines, the local media reported.

Danang imposes ban on beach swimming, events to prevent Covid-19 wave

Earlier this morning, May 4, a warning tape fence was placed along the over 20-kilometer-long Danang coastal road, stretching from the Nam O beach (in Lien Chieu District) to the Marble Mount area.

This is in response to the official letter by the Danang People’s Committee last night on strengthening prevention measures against Covid-19 after a case was discovered in the central city on the same day.

Specifically, gymnastics, sports, bodybuilding at the gym, yoga, billiards, indoor sports activities, sports and martial arts and swimming on the beach were banned from May 4 until further notice.

Nguyen Van Loi, owner of an establishment offering freshwater bathing and parking services near My Khe beach in Son Tra District, said that earlier this morning, many people went to the beach as usual, but they had to return because it was forbidden by the local authorities.

This is the latest beach swimming ban in Danang after the first two in March and August 2020 when the Covid-19 waves broke out.

In addition to swimming activities being banned, some other activities in Danang were also suspended, including cultural and entertainment festivals.

Those running entertainment and beauty establishments, bars, pubs, discos, karaoke and massage parlors, video game arcades, movie theaters, casinos and public internet services must also remain shut. Activities at walking streets, night markets or dining with more than 30 people have also been prohibited.

Public passenger transportation services are available, but they must carry no more than half of the allowed number of people for each type of vehicle, ensuring safety.

This morning, Le Trung Chinh, Chairman of the Danang People’s Committee, signed an official letter, proposing all students take 4-5 days off school until further notice.

Previously, the Steering Committee for Covid-19 Epidemic Prevention in Danang had announced a Covid-19 case.

Phu An Hotel where the patient worked has been shut down, while 11 people working there have also been quarantined at the hotel.

In another development, the  government of Hoi An City in Quang Nam Province also suspended visits to the ancient town, traditional crafts villages and pedestrian streets from May 4.

Prices of consumer goods about to climb

The promotional program to stimulate the purchasing power on the occasion of the Reunification Day and the International Workers’ Day is going to end, while the prices of input materials have been climbing sharply, significantly affecting the pressure of increasing the selling prices of many essential goods.

Although there have not any official statistics from the authorities yet, according to some retailers and enterprises, the purchasing power in the last holidays increased by two times compared to normal days. Many retailers reduced prices sharply on thousands of products. Particularly, fresh food discounted 10-20 percent, kitchen utensils dropped 21-47 percent, and health care products offered a discount of 50 percent for the second item.

According to the representative of Co.opmart supermarkets, because the holiday of the Reunification Day and the International Workers’ Day this year lasted for four days, the purchasing power at Co.opmart supermarket network, on average, rose two to four times higher compared to normal days. The highest increase in the purchasing power focused on fresh foods, some types of processed foods, frozen goods, beer, and soft drinks. Other products, such as household appliances and garments, were being strongly discounted, so the purchasing power also doubled compared to before.

Similarly, at Lotte Mart, Emart, and MM Mega Market An Phu, in recent days, the purchasing power has also increased significantly and increased drastically in the afternoons and evenings of the holiday, focusing on fresh food products, including meat, fish, seafood, fruits, and vegetables. Items, such as confectionery, canned food, and garments, were also interested by consumers. Ms. Nguyen An Nhien, a resident in Thu Duc City said that the holiday is a “golden” opportunity for her family to buy many items at the best prices. For instance, Emart currently offers promotions for hundreds of essential items with attractive combo gift packages applicable to food, beverages, cosmetics, clothing, and household appliances. To meet the increasing shopping demand on the occasion of the holiday, supermarkets have also enhanced their staff of all stages, at the same time, increased the source of goods to best ensure the demand of customers.

Shopping centers in Ho Chi Minh City, especially Vincom Center, Takashimaya, and Giga Mall, were always highly patronized. Besides the need for window shopping, entertainment, shopping, and dining, a large number of visitors go to the shopping centers to escape the heat, contributing to making the atmosphere of these places bustling during the holiday.

In terms of prices during the holiday, retailers had worked closely with suppliers to reduce prices by up to 50 percent for various products to stimulate consumer demand, so they have created a stable common ground of selling prices. The supply of goods for the market is plentiful and diverse. At traditional wet markets, many small traders said that the selling prices of all kinds of goods were fairly stable. The groups of items that were bought heavily at the markets included fresh food, fruits, and ready-made clothes.

According to forecasts of the domestic market management unit, in May and the coming time, the market of essential goods will not have any major fluctuation in supply and demand. However, the impacts of the global prices or the increase in import duties on some input materials in the first months of the year will affect the prices of some commodities, such as agricultural products, milk, and processed foods.

It is recorded that the prices of some items retailed at grocery stores, such as instant noodles, seasoning powder, spice powder, cooking oil, and cake flour, increased by 7-10 percent compared to those at the end of last year. Some cake flour producers explained that the prices of many input materials increased by up to 20 percent. Currently, the purchasing power in the market remains weak, if they increase the selling prices of finished products based on the prices of raw materials, it will be difficult to convince consumers. Therefore, for these manufacturing enterprises, increasing the selling prices at this time is a necessary evil.

The group of fresh food products, such as poultry meat and eggs, also increased by 10-15 percent compared to the beginning of 2021. This situation is because the price of animal feed surged by more than 20 percent and that of packaging went up by about 15 percent. Besides, the pressure to increase the selling prices of many fresh foods also comes from the increasing gasoline prices, which affected freight rates from provinces to HCMC.

A representative of the purchasing department of one of the major distribution network in HCMC said that although suppliers sent requests to increase the selling prices, mainly the group of fast-moving consumer goods, from May, to harmonize the interests of all parties, the supermarket will carefully consider the possibility of increasing the selling price of each item, as well as the group of goods, avoiding causing a disturbance in the general price level of commodities, affecting consumer psychology. Besides the increase in the prices of input materials, the prices of many product groups are higher than before because the promotional program has ended.

The selling prices of some products may increase slightly, but essential goods will certainly be plentiful and diverse. Even the group of items serving the prevention of the Covid-19 pandemic, such as hand sanitizers and masks, are also fully prepared.

To continue stabilizing the goods and services market, the domestic market management unit recommended ministries, industries, and localities to continue to closely coordinate in the management of market and prices of goods and propaganda to create consensus in public opinion with the State’s administration, and stabilize the commodity market.

Chili price sinks heavily, farmers forsake harvesting

According to the journalist of Sai Gon Giai Phong Newspaper, farmers in Phu My District and some midland and mountainous districts of Binh Dinh Province have entered the harvest of chilies. This year, thanks to favorable weather, chili plants give more fruits than in previous years. Because farmers harvest chilies at the same time, the price of chilies drops steeply.

In Phu My District, traders are buying bird’s eye chilies for only VND3,000-VND5,000 per kilogram while at the beginning of the season, the price was VND15,000 per kilogram. Many chili farmers even cannot find any trader to sell. Many households with a large area of chilies have to leave the ripe chilies in the field because they cannot afford to hire workers to pick them.

The representative of the Department of Agriculture and Rural Development of Phu My District said that the growing area of chilies in the whole district this year was about 1,262 hectares, an increase of 30 hectares compared to last year. This year, the yield of chilies is extremely high, from 1 to 1.5 tons per 500 square meters. Currently, the price of chilies is too low, so the locality has reported to the higher level to find a solution to help farmers.

Vietnam trade turnover records 10-year high growth to US$207 billion in Jan-Apr

Vietnam posted a trade surplus of US$1.29 billion during the four-month period, a positive result amid difficult global trade environment as a result of the Covid-19 pandemic.

Vietnam’s trade turnover in the January-April period rose by a 10-year high growth of 29.5% year-on-year to reach US$206.5 billion, the General Statistics Office (GSO) has said in a monthly report.

Upon breaking down, the country’s exports during the period surged by 28.3% year-on-year to US$103.9 billion, while imports were estimated at US$102.61 billion, up 30.8%.

As Vietnam reported an estimated trade deficit of US$1.5 billion in April, the overall trade surplus in the first four months of 2021 was narrowed to US$1.29 billion, but remained a positive note amid difficult global trade environment as a result of the Covid-19 pandemic.

According to the GSO, the foreign-invested sector made up 75.2% of the total exports with US$78.14 billion, representing an increase of 34.4% year-on-year, while the domestic-invested sector exported US$25.76 billion, or 24.8% of the total.

Among Vietnam’s key export staples, phones and parts earned the largest export turnover during the January-April period of US$18.4 billion, up 19.4% year-on-year and accounting for 17.7% of Vietnam’s total exports.

In addition, electronic products, computers and components have earned an estimated US$15.9 billion, up 30.8% year-on-year; followed by equipment and parts (US$12 billion and up 76.9%); garments (US$9.5 billion and up 9%).

Deputy Director of the Ministry of Industry and Trade’s Import and Export Department Tran Thanh Hai attributed Vietnam’s effective measures against the Covid-19 pandemic to its strong performance in trade.

“No disruption to business and production activities was key to help local traders fulfill their  their foreign peers’ orders,” said Hai.

Meanwhile, efforts from Vietnamese enterprises in adjusting to the new situation during the pandemic have also been decisive, he noted.

On the trade outlook for this year, Deputy Minister of Industry and Trade Do Thang Hai warned any resurgence of the Covid-19 pandemic would cause negative impacts on trade activities.

“Given the current context, safety measures to combat the pandemic continue to be the utmost priority,” said Hai.

Amid growing uncertainties surrounding the pandemic situation, Head of the Macroeconomic Policy Department under the Central Institute for Economic Management (CIEM) Nguyen Anh Duong called for enterprises to focus on markets having free trade agreements (FTAs) with Vietnam.

In the first four months of the year, the US, China, EU, ASEAN and South Korea remained Vietnam’s largest five export markets.

Meanwhile, China continued to be Vietnam’s largest supplier, selling US$33.1 billion worth of goods to Vietnam, or an increase of 47.8% year-on-year.

South Korea claimed the second place by exporting US$16.9 billion worth of goods to Vietnam, up 16.9% year-on-year, followed by ASEAN countries with US$14.1 billion, up 48.2%.

COVID-19 developments remain complicated in regional countries

The Lao Ministry of Health confirmed 46 new COVID-19 cases on May 5, mostly in Vientiane and Bokeo province with 19 and 15 cases, respectively.

According to the ministry, the decreased number of newly-confirmed cases showed the efficiency of drastic measures applied by the Lao Government.

From May 4, the Lao government decided to apply lockdown for additional 15 days until May 20.

So far, Laos has discovered 1,072 COVID-19 cases, including 99 recoveries and no death.

Meanwhile in Thailand, the pandemic is still developing complicatedly with 2,112 new cases confirmed on May 5 and 15 deaths, raising the total cases to 74,000 cases, with 318 deaths.

Bangkok is still a hot spot of COVID-19 with 789 cases.

In Indonesia, 155,000 soldiers and policemen will be deployed within the framework of Operation Ketupat Jaya 2021 from May 6-17 to minimise the spreading of COVID-19 during the Muslims Eid al-Fitr holidays from May 13-14.

Some 4,276 personnel will be stationed in the capital city and its adjoining areas. The Jakarta Police will deploy these personnel at 14 isolation points and 17 check points.

The Operation Ketupat Jaya 2021 is being conducted to block access to and from Jabodetabek, to maintain security, and to monitor the implementation of health protocols to stem the transmission of the coronavirus disease before, during, and after Eid al-Fitr, among others.

Meanwhile, spokesperson for the COVID-19 Handling Task Force Wiku Adisasmito affirmed that all forms of homecoming activities, including the local homecoming, are banned during Ramadan and Eid al-Fitr to lower the rate of COVID-19 infection.

At the same time, Malaysia’s capital city of Kuala Lumpur will re-apply movement control order (MCO) from May 7. This will be the third time the city is placed in MCO to control the COVID-19 pandemic.

Malaysian Defence Minister Ismail Sabri Yaakob said that the order is given after 17 new clusters were recorded.

The order will be applied until May 20. Food premises, such as restaurants, food trucks, hawkers and kiosks, are allowed to operate from 6am to midnight only. Dine-ins are not allowed and food served are for delivery and takeaways only.

Malaysia on May 5 logged 3,744 new cases in the last 24 hours to bring the total to 424,376. There were 17 more deaths, bringing the total fatalities to 1,591.

The MCO was applied for the first time on March 18, 2020 and the second time on January 13, 2021.

The same day, Executive Secretary of the Philippine Presidential Office Salvador Medialdea said that the Southeast Asian country will ban tourists from Pakistan, Nepal, Sri Lanka and Bangladesh from May 7-14 as part of efforts to prevent the entry of SARS-CoV-2 variants found in India.

Earlier, the Philippines banned travelers from India from April 29 to May 14.

On May 5, the country confirmed 5,685 new COVID-19 cases and 178 deaths, raising the count to more than 1 million with 17,800 deaths.

In Cambodia, Prime Minister Hun Sen on May 5 ordered to vaccinate more than 52,000 people in all areas in the red zones of Phnom Penh with COVID-19 vaccines, with the administration of the first dose to be completed soon and the second dose to commence once the stipulated time frame has been reached.

To date, more than 1.5 million people have been vaccinated with either Sinopharm, Sinovac or Covishield (AstraZenacca vaccines) since February 10.

The same day, the Cambodian Ministry of Health confirmed 672 new cases, raising the total cases to 16,971, including 110 deaths./.

Party chief commends role of banking sector in growth

Party General Secretary Nguyen Phu Trong lauded efforts and achievements made by the banking sector during the national cause of economic development as he delivered a speech at a ceremony marking the sector’s 70th founding anniversary (May 6).

Describing the sector as the lifeblood of the economy, he hoped it to continue contributing to the nation’s reform, industrialisation and modernisation.

The Party leader recommended the sector enhance the efficiency of the State Bank of Vietnam (SBV)’s management and monetary policy, while ensuring the security, safety, and effectiveness of credit organisations’ operations.

The sector should keep up its efforts to control inflation, stabilise the macroeconomy, mobilise and meet demand for credit, and offer banking services serving socio-economic growth, Trong said.

At the event held on May 5, State Bank Governor Nguyen Thi Hong underscored the SBV will closely follow orientations and policies issued under the 13th Nation Party Congress’s Resolution in directing and managing banking activities in contribution to realizing targets set in the 2021 – 2025 plan and 2021 – 2030 strategy for socio-economic development as well as the vision toward 2045.

The SBV will boost the effectiveness of its monetary policy monitoring and its capacity to adapt to domestic and global economic fluctuations so as to realize the goals of inflation control, stable macroeconomics, helping enhance the economy’s independence and autonomy amid international integration, she noted.

Restructuring, completing legal frameworks, diversifying services, and promoting administration reform and innovation are also other tasks of the sector, the SBV governor added.

On the occasion, the SBV was conferred with the Labour Order, first class./.

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

A view of Khai Quang Industrial Park in Vinh Yen city of Vinh Phuc province

Tim Leelahaphan, the bank’s economist for Vietnam and Thailand, held that Vietnam’s economy remains strong and the country is proving to be one of the world’s best performing economies amid the COVID-19 pandemic.

However, he added, like many other countries, Vietnam is feeling the impact of the domestic COVID-19 situation, which is inevitable.

Vietnam began its COVID-19 vaccination campaign on March 8, with about 1 million people, mostly frontline health workers, receiving jabs so far. Expanding the campaign is a key condition for reopening tourism and promoting sustainable economic recovery, he said.

Other Standard Chartered specialists pointed out that the country’s trade figures have remained positive since last year.

In particular, mobile phones and accessories have accounted for some 16 percent of total overseas shipments and electronic devices, computers, and spare parts about 15 percent.

Vietnam also posted a trade surplus of 1.3 billion USD in the first four months of 2021.

Rapid economic growth may boost inflation, the specialists noted, adding that rising world food prices are also affecting domestic inflation.

They forecast inflation in Vietnam at 3.8 percent this year./.

Vietnam manufacturing output remains solid amid Covid-19 outbreak

Business sentiment eased to a three-month low on worries about the Covid-19 outbreak, but firms remained optimistic overall that output will increase over the coming year.

The Vietnam Manufacturing Purchasing Managers’ Index (PMI) posted 53.1 in May, down from 54.7 in April. The latest reading, however, signaled a sixth successive improvement in business conditions, and one that was solid despite weakening from the previous month, according to Nikkei and HIS Markit.

A reading below the 50 neutral marks indicates no change from the previous month, while a reading below 50 indicates contractions and above 50 points to an expansion.

“Latest data and anecdotal evidence from respondents suggested that the recent outbreak of the COVID-19 pandemic limited growth of both output and new orders midway through the second quarter of the year,” noted the IHS Markit’s report.

While the rate of expansion in production eased to a three-month low, it stayed in the positive trend as new orders continued to rise, it added.

The same was true for new business, which increased at the softest pace since February but for the ninth month running. Solid growth was also recorded for new business from abroad as some export markets showed signs of recovery from the Covid-19 pandemic.

Rising case numbers also impacted hiring in the Vietnamese manufacturing sector. Employment increased for the fourth consecutive month, but only modestly.

Staff shortages contributed to a near-record rise in backlogs of work as firms struggled to cope with inflows of new orders. Outstanding business accumulated to the greatest extent in more than a decade.

Operations were also hampered by a marked lengthening of suppliers’ delivery times, the greatest in just over a year. Again, the pandemic was a factor behind longer lead times, with shipping delays and material shortages also highlighted.

Despite delivery delays, firms expanded both their quantity and stocks of purchases amid efforts to build reserves. That said, in both cases, rates of increase were slower than in April.

Stocks of finished goods, meanwhile, were broadly unchanged amid the use of inventories to help meet new orders while production volumes were restricted. The stabilization ended a three-month sequence of rising stocks of finished goods.

The rate of input cost inflation quickened to a 40-month high in May. Supply shortages contributed to rising raw material prices, with iron, oil, and steel all mentioned in particular as costing more. Higher freight prices were also signaled.

In turn, manufacturers raised their own selling prices at a substantial pace. Moreover, the rate of inflation was the fastest in just over a decade, and the third-steepest since the survey began.

Businesses remain optimistic

Business sentiment eased to a three-month low on worries about the Covid-19 outbreak, but firms remained optimistic overall that output will increase over the coming year. Hopes that the virus will be brought back under control and the prospect of further new order growth supported confidence.

“The challenges of the Covid-19 pandemic returned to the Vietnamese manufacturing sector during May as an outbreak in the country hampered operations,” said Andrew Harker, associate director at IHS Markit, which compiles the survey.

“Output, new orders and employment all grew at slower rates, while difficulties completing orders meant that backlogs of work increased at one of the sharpest rates in more than ten years of data collection. Efforts to fulfil orders weren’t helped by further supply-chain disruption, which also contributed to price pressures. In fact, firms raised their selling prices at the fastest pace in more than a decade,” said Harker.

“Firms will be hoping that the Covid-19 outbreak can be brought under control quickly, as has been the case in the past in Vietnam. Confidence took a hit in May, but firms remained optimistic regarding the 12-month outlook for production,” he noted.

In May, Hanoi’s index of industrial production rose by 1.8% against last month and 5.1% year-on-year, leading to an overall growth of nearly 10% year-on-year in the five-month period and contributing a major part to the city’s push for economic recovery.

The manufacturing and processing sector, accounting for 96% of total production value in the local industry sector, remained key driving force with an expansion rate of 9.7% year-on-year.

Trade deficit returns in May

Vietnam incurred a trade deficit of US$2 billion in May, after earning trade surplus of US$1.63 billion in Jan-April, according to the General Statistics Office.

The complicated developments of Covid-19 in some localities affected trade, transport and tourism activities in May, the local media reported.

The country earned US$26 billion from exports and spent US$28 billion on imports in May, up 35.6% and 56.4% over the year-ago period.

Despite an increase by 33% in the country’s import-export turnover in the first five months of the year to over US$262 billion, the country suffered a trade deficit of US$369 million in the period.

In the first five months, the country exported more than US$130.94 billion worth of products, surging nearly 31%.

The United States remained Vietnam’s largest buyer with a revenue of US$37.6 billion, soaring nearly 50% over the same period last year. Exports to China also rose 26% to US$20 billion.

Meanwhile, the country spent US$131.31 billion on imports in January-May, up 36.4% year-on-year.

China was the largest supplier to Vietnam with US$43.3 billion, surging 53%, followed by South Korea, ASEAN, Japan, the European Union and the United States.

Agricultural products the next big move in e-commerce

Putting agricultural products on online trading is growing as a new trend of the local e-commerce sector this year.

Both Lazada and Sendo have carried out several programmes to support the northern province of Hai Duong’s farmers to sell litchi products on their e-commerce platforms. According to Dang Dang Truong, PR lead at Sendo, just between May 24 and 27, a total of 12 tonnes of litchi were sold through the platform.

Similarly, at a recent conference promoting the export of agricultural products from Hai Duong held by the Vietnam Trade Promotion Agency (Vietrade), newly-established online shopping sites such as Voso (Viettel Post) and Postmart (Vietnam Post) also announced to start focusing on agricultural items instead of fast-moving consumer goods, clothes, and cosmetics like other platforms.

The new segment also lured in the involvement of startups such as Vietnam-based FoodMap and Indonesia-based TaniFund. So far, TaniFund has successfully mobilised $65.5 million Series B funding, led by MDI Ventures, while harbouring plans to enter Vietnam at the soonest.

In a previous talk with VIR, Sendo founder and CEO Tran Hai Linh said that agricultural goods have solid trade potential on e-commerce sites in Vietnam because they have been one of the most consumed commodities in Vietnam. However, to date, due to obstacles related to logistics and transportation, agricultural items, especially fresh food, have yet to reach popularity on online shopping sites.

He explained the hardest part of entering the segment is ensuring the best quality of fresh food products during transportation. There need to be suitable packaging and transporting processes to keep produce fresh and undamaged on short and longer trips.

Pham Ngoc Anh Tung, founder of FoodMap has also highlighted the high investment costs that come with entering this retail segment.

According to Development Reimagined, a China-headquartered organisation specialised in diplomacy, environment, and public relations, selling agricultural products online cost a long time and large investments before reaching success. For example, in China, e-commerce giant Alibaba in 2015 carried out the “Taobao villages” programme to help farmers sell their products on its Taobao platform. However, until 2020, purchasing agricultural goods online reached common in the country.

Bank stocks witness upswing in prices

Bank stock prices have witnessed a dramatic increase since the end of March after plenty of banks announced positive first-quarter business results, as well as news on rising mergers and acquisitions (M&A).

Among the listed banks, Vietnam Prosperity Commercial Joint Stock Bank (VPB) has been the strongest performer in the stock market since the beginning of this year. VPB closed the trading session on December 31 at VND32,500 (US$1.41) per share, it now is being traded at VND67,600 per share, equivalent to an increase of 108 per cent.

VPB’s gain was attributed to the news that VPBank has sold 49 per cent of its charter capital at FE Credit to Japan’s SMBC Group at a valuation of $2.8 billion. VPB shares are also attractive thanks to its leading position in the consumer finance segment and the private placement plan for foreign strategic partners.

Lien Viet Post Commercial Joint Stock Bank (LienVietPostBank) has also witnessed an increase of more than 104 per cent since the beginning of this year, currently trading at VND25,400 per share.

Nguyen Duc Thuy, a founding shareholder of Thaiholdings Joint Stock Company (THD), has officially been elected as Vice Chairman of the Board of Directors of LienVietPostBank since early May.

After less than a year after listing, the market price of THD has increased 13 times, from the reference price on the first trading day of VND15,000 per share to VND197,100 per share on May 26 this year.

At LienVietPostBank’s 2021 Annual General Meeting of Shareholders held at the end of April, shareholders shared that they hope the same gain will also happen to the bank’s shares.

Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank) also underwent an increase of more than 74 per cent since the beginning of this year. Vietnam International Commercial Bank (VIB) rose by 94 per cent compared to the end of 2020; Southeast Asia Commercial Joint Stock Bank (SSB) gained by 84 per cent so far this year and has maintained its upward momentum after two months of listing on HOSE.

National Commercial Joint Stock Bank (NVB) witnessed an impressive increase of more than 80 per cent and Vietnam Joint Stock Commercial Bank for Industry and Trade (CTG) rose 49 per cent so far this year.

In a recent report, SSI Securities Joint Stock Company said that banks’ plan to raise charter capital can be a supportive factor for the movement of bank stock prices from now until the end of 2021.

In 2021, there are about 16 banks with plans to increase their charter capital significantly, according to the report. Specifically, charter capital at these banks will be increased by VND82.7 trillion, up 31 per cent compared to 2020. Of the estimate, about 75 per cent will be increased through stock split; 22 per cent from private placement and the rest is through the employee stock ownership plan (ESOP).

From 2020, the State Bank will tighten the payment of cash dividends by banks. Instead, the State Bank encourages them to pay dividends in stock.

Japan licenses two more fresh lychee processing facilities in Hai Duong

Japan has licensed two more lychee processing facilities in Hai Duong Province, the hometown of “thieu” lychee specialty, to facilitate the fruit export to Japanese market.

According to the Plant Protection Department under the Ministry of Agriculture and Rural Development, the facilities commenced the processing of lychees for export to Japan on May 29.

The two treatment facilities are owned by Ameii Vietnam Joint Stock Company and Rong Do Limited Liability Company, featuring three processing chambers, each with a capacity of 2.5-3 tonnes/batch.

To date, Japan has recognised a total of four lychee processing facilities for export to this market, with five chambers operated by four local units, helping to increase the total processing capacity to 35-40 batches/day, many times higher than the processing capacity last year.

In 2020, only from 7.5-8 tonnes of lychee were treated each day before leaving for Japan.

Safety procedures have also been strengthened so that plant quarantine officers can rest assured to work in the current complicated COVID-19 situation, not to affect lychee exports.

Regarding the quality of this year’s lychee crop, Japan customers have rated it as having a higher quality than that of 2020. Lychee exported to Japan in the past few days has been sold out in only 2-3 hours.

Currently, Thanh Ha early-ripen lychee in Hai Duong’s Thanh Ha District has consumed about 65% of production and is expected to produce about 30,000 tonnes, while main season lychee are expected to reach about 25,000 tonnes this year, an increase of 15,000 tonnes compared to 2020.

The main lychee season will begin from June 1 and reach its peak of harvesting from June 5 in Hai Duong.

This year, thanks to the promotion of sales channels, Hai Duong lychee prices are higher. For lychees produced under the export process to Japan and Singapore, businesses are purchasing at VND7,000-10,000 per kg higher compared to lychees grown outside the export areas.

Ho Chi Minh City’s State budget revenue enjoys year-on-year rise of 22.8%

Ho Chi Minh City’s State budget collection is estimated to hit VND174.6 trillion (US$7.57 billion) during January-May, equivalent to 49 percent of the yearly estimates and up 22.8% year-on-year.

The figure also represented a rise of 5.7% compared to that of the same period of 2019 when the COVID-19 pandemic had yet to break out around the world.

Of the total, domestic revenue in the city was estimated at VND123.69 billion, equal to 49.8% of the estimates and accounting for 70.8% of the total and up 21.1% over the same period. Revenue from import-export activities is estimated at VND50.9 trillion, equal to 47.1% of the estimates and up 27.3% year-on-year. Revenue from crude oil is estimated at VND5.86 trillion, equal to 68.6% of the estimates and up 3.2% year-on-year.

Meanwhile, local budget revenue in the period is estimated at VND34.18 trillion, accounting for 19.6% of the total collection, equivalent to 41.6% of the estimates and up 7.5% year-on-year.

This year, the largest city of Vietnam is assigned to collect VND364.89 trillion for the State budget, down 10.1% from the 2020 estimates and 1.7% compared to last year’s real revenue.

Buyers hedge their bets on premier apartment purchases

It remains to be seen if a plan to open for sale the first products of a 6.4-hectare residential apartment project developed by FLC Group this year will go ahead on schedule as wary buyers wait on further pandemic developments.

Located in a 6.4-hectare area in Hanoi, the Premier Parc apartment complex started construction in January this year. Currently, the project is developing its infrastructure system with water drainage, inner roads, and lighting.

In June 2019, FLC Group formed a joint venture with South Korean Lotte Land to develop this project. However, in this February, the cooperation was terminated and FLC Group has continued development on its own.

Premier Parc will provide 145 shophouses, villas, semi-detached houses, and two high-end apartment buildings which are set to be handed over to buyers by the third quarter of 2022.

However, there are signs that staying on schedule will be difficult, especially as COVID-19 continues to make its presence felt in the country.

Nguyen Van Minh, a sales agent in Hanoi, said that his customers have been waiting for this project for a long time. However, with current pandemic restrictions in place over the past month, Minh doubts that the products will actually go on sale anytime soon.

FLC Group won the auction for the land in 2017 at a price of VND860 billion ($37.4 million), nearly three times higher than its initial quotation. The project was initially expected to be completed in mid-2019.

FLC is known as a major real estate developer with 400 projects nationwide – however, the developer has something of a track record for slow progress, leading to disputes with buyers. For instance, FLC Coastal Hill – Quy Nhon committed to hand over units to buyers by the fourth quarter of 2018 but FLC Group delayed it to this year.

Other reported violations include slow progress of construction, lack of committed facilities, and failing to hand over pink books to buyers at other projects such as FLC Quang Binh Beach and Golf Resort, FLC Sea Tower Quy Nhon, and FLC Garden City.

The prolonged pandemic has slowed many projects nationwide. According to a recent report released by the Ministry of Construction, more than 9,000 residential units were unsold across Vietnam as of the end of 2020.

Reasons for unsold units piling up were many but it was mostly due to the legal bottlenecks as well as the incapability of developers, leading to buyers hesitating during the pandemic.

Dat Xanh Group, as of the end of 2020, reported 55 per cent of total asset value, equivalent to $433 million, in stockpile, mostly in the An Vien, Luxgarden, Pho Duc Chinh, and Ngo Quyen projects.

Phat Dat Real Estate Development JSC, meanwhile, is also shouldering a stockpile of more than VND9.3 trillion ($404.35 million), accounting for 60 per cent of its total asset value, mainly in The EverRich 2, Nhon Hoi Eco-tourism Area, and Binh Duong Astral City.

Meanwhile, An Gia Real Estate Investment and Development Corporation is holding a large number of units in The Song, The Westage, River Panorama 1 and 2, Sky 89, and Signial.

Vietnamese bank rushes for digitalised products and services for import – export companies

Several banks are exploring digital ways to simplify the hefty paperwork that comes with international trade to enhance operational efficiency and support export-import companies. Military Bank (MB) – one of Vietnam’s largest commercial banks – is also accelerating its strength to bridge the gap between local enterprises and international markets and drive long-term resilience.

Founded in 2014, Ant Group’s origins begin with digital payment service Alipay. As of now, based on a strong technological foundation, Ant Group has expanded into many other financial services and even erodes the profits of Chinese traditional financial institutions.

A contender to one of the major banks now, Ant Group’s roots reach back to digital payment service provider Alipay. Since then, utilising its strong technological foundation, Ant Group has expanded into many other financial services and even erodes the profits of Chinese traditional financial institutions.

Ant CEO Eric Jing said in 2017 that Ant Group named itself after a small insect because it serves “the little guys”. However, the next few years showed that with digital transformation as the catalyst, “ants” can beat “elephants”, according to Business Insider.

In Vietnam, as fintech companies receive initial success, traditional banks are accelerating the digital transformation by developing new products and services. Several years ago, e-banking systems were mostly for account inquiries and domestic fund transfers. However, now, more robust products and services have been launched online to support tax payment, bill payments, as well as payroll and terms deposit management. Notably, even corporations can now open a bank account without visiting any physical branch.

That being said, the number of digital products and services for export-import activities remains limited. Realising this gap, some commercial banks have pioneered new features such as international payment and trade finance on online channels to enhance customer experience. Military Bank (MB) is one of the outstanding players in this competition.

The online international payment feature on BIZ MBBank, which was officially launched in July 2020, received a warm welcome from customers. The feature meets a variety of customers’ demands related to international payment, including making transfers, buying foreign currency, creating amendment/tracing/cancellation, submitting required documents, and making transfer inquiries.

Customers can conduct these activities online without spending time at brick-and-mortar counters. In addition, MB is one of the four banks in Vietnam to apply the SWIFT gpi initiative, which helps speed up transactions. Courtesy of SWIFT gpi, customers are allowed to benefit from real-time transaction tracing without additional costs.

Compared to conducting international transfers at counters, the process is significantly less time-consuming via BIZ MBBank, courtesy of automation. Customers can also save time and costs on paperwork and transportation. Those choosing to make transactions with MB can access favourable exchange rates without any conditions.

Being one of the very first companies to use online international payments on BIZ MBBank since the first days, Epi Viet Nam Technologies Co., Ltd. highly appreciates the experience BIZ MBBank has offered their customers.

“Both the bank and corporates are able to benefit from online international payment. It helps eliminate duplicated steps, enhancing efficiency and speeding up the overall processing time,” said Nguyen Thi Thuong, finance director at Epi Viet Nam.

“It used to take us hours to process paperwork and get the SWIFT messages. Since the launch of international payment on BIZ MBBank, the entire processing time has been reduced to less than an hour,” she added. “This particularly comes in handy in the context of the COVID-19 pandemic.”

Furthermore, to enhance customer experience, BIZ MBBank allows customers to sell foreign currency automatically. The process is 100 per cent automatic, enabling customers to exchange foreign currencies into Vietnam Dong as soon as they approve the transactions. MB is also planning to launch a new feature called “chat box” to provide customers with tailored and unique experiences.

MB has been known for its transformative initiatives in offering international payment – trade finance products in the market. In December 2020, MB successfully executed the complete life cycle of two blockchain-enabled import letters of credit (LCs) over the CONTOUR network. With these pioneering actions, MB is constantly affirming its position in the digital transformation race, especially in developing products for corporates and those conducting export-import activities.

Hanoi welcomes nearly three million visitors over five-month period

Hanoi welcomed approximately 2.89 million visitors during the course of the opening five months of the year, representing a year-on-year decline of 6.7%, according to figures compiled by the Hanoi Department of Tourism.

Total tourism revenue from domestic tourists stood at an estimated VND8.1 trillion, down by 50.7% compared to the same period from last year.

May alone saw the number of domestic tourists to the capital fall by 53.3% to 115,000 against the same period from last year, with revenue from domestic tourists being estimated at VND322 billion, an annual drop of 60.3%.

Since the beginning of the year, hotel room occupancy in Hanoi has reached just 23.6%, largely due to the adverse impacts of the novel coronavirus (COVID-19) pandemic, marking a decrease of 8.6% on-year.

The average occupancy rate of one to five star hotels in Hanoi was at 26.4% in May, down 1.7% from the previous month, but marking a rise of 7.12% compared to the same period last year.

The decline in the number of travelers visiting the capital can primarily be attributed to the complicated developments relating to the COVID-19 pandemic. This comes as tourist attractions in Hanoi temporarily stopped receiving tourists from May 3.

Custom watchdog tightens control over origin fraud of Vietnamese rice

The Ho Chi Minh City Customs Department has detained three shipments of rice passing through Cat Lai port after detecting signs of fraud relating to their Vietnamese origin.

According to the Saigon port area 1 Customs Branch, the unit moved to seize dozens of containers of rice imported from India due to suspicions that their Vietnamese origin was fraudulent.

The shipments belonged to two import declarations registered by an enterprise based in Hanoi, with import procedures being carried out through Cat Lai port at the end of February and March.

According to information released by the customs declaration, these batches of rice actually originate from India. However, after a thorough examination and inspection was carried out, customs officials successfully discovered that all of the packages and labels on the imported rice stated that they had Vietnamese origin.

Most notably, the package of each bag of rice had the brands and addresses of factories and businesses located in the nation.

After being suspicious of the origin of these goods, the unit moved to seize all shipments for the purpose of investigation and clarification.

Furthermore, there has also been signs of origin fraud in Vietnamese white rice. According to Vietnam’s Special Preferential Import Tariff relating to the implementation of the ASEAN-India Trade in Goods Agreement, 5% broken and 100% broken white rice imported from India enjoy a tax rate of 0%.

Moreover, the price of these two types of rice from India is only approximately US$400 per tonne and US$280 per tonne respectively, roughly US$100 per tonne lower than the price of Vietnamese rice.

The price of imported rice from India to Vietnam is therefore much more competitive compared to Vietnamese rice.

The Ho Chi Minh City Customs Department has recently devised a plan aimed at strengthen inspection over origin fraud and counterfeiting of labeling of goods, the infringement of intellectual property rights, and the illegal transshipment of Vietnamese white rice.

HCMC pledges to ensure sufficient food supply for local residents

The HCMC Department of Industry and Trade has worked out plans to provide more than 10,000 tons of food per day to local residents and implemented programs to connect with 22 other provinces to ensure the sufficient supply of food for residents during the social distancing period.

Bui Ta Hoang Vu, director of the municipal Department of Industry and Trade, said the department would ensure market stability while fighting the pandemic, and residents in the city do not need to flock to supermarkets and convenience stores to buy food for stockpiling.

Some 8,000 tons of vegetables and fruits will be available daily at the Binh Dien, Hoc Mon and Thu Duc wholesale markets. The volume will meet 70% of the demand from local residents. The remaining 30% will be met by supermarkets and large distributors.

As for meat and fish, the city has some 700 tons of pork, while the supply of poultry and seafood is abundant.

As many local residents have been rushing to stock up on food, Vu said they should not be worried about the shortage of food. He has asked enterprises to enhance online sales channels to reduce contact and gatherings.

Many large supermarkets in the city have increased their supplies and worked out long-term plans to ensure sufficient essential commodities.

According to Saigon Co.op, besides increasing supplies, it will make contact with Covid-19 checkpoints and quarantine facilities to provide products.

The Domestic Market Department under the Ministry of Industry and Trade has coordinated with the HCMC Department of Industry and Trade to ensure the provision of products and deal with obstacles hindering the transportation of products.

Massive airplanes face difficulties in overnight parking shortage

Director of the Civil Aviation Authority of Vietnam (CAAV) Dinh Viet Thang has just required the Airports Corporation of Vietnam, the international airports of Noi Bai and Tan Son Nhat to handle the parking shortage of airplanes overnight due to limited operation amid the current complicated Covid-19 pandemic situation.

According to the Civil Aviation Authority of Vietnam, the Covid-19 pandemic had hugely affected civil aviation activities nationwide. The flight exploitation has reduced, leading to the surge of airplane volumes parking overnight, especially in Noi Bai and Tan Son Nhat International Airports, where placing the maintenance facilities of the airlines.

To overcome the overload, CAAV required the relevant units to promptly clarify the demand of the overnight parking of the airlines, plan the allocation, arrange the parking lots at several airports during the long-lasting pandemic.

Particularly, the head of CAAV stressed that the relevant units need to maximize the parking lots overnight at the approved home-base of airlines, avoiding the concentration at Noi Bai and Tan Son Nhat International Airports.

If the airlines do not have the main maintenance and management facilities at Noi Bai and Tan Son Nhat airports, the relevant units have to review and restore the temporary parking lots overnight or allocate the parking at closed taxiways and the limitedly operated ones to minimize the influence of the airports’ exploitation.

Winners of Vietnam Specialty Coffee Competition announced

Khe Sanh Arabica coffee of Pun Coffee Co. Ltd. has won the first prize at the Vietnam Specialty Coffee Competition 2021 held by Buon Ma Thuot Coffee Association in the Central Highlands province of Dak Lak.

The second and third prizes were presented to products of Quang Tri specialty coffee group and Ngoc Linh Gingseng Joint Stock Company in Kon Tum province, respectively.

Regarding to Robusta coffee, Ea Tu Cooperative in Buon Ma Thuot city took the first prize. Mori Coffee Co. Ltd. in Gia Lai province and Phuc Minh Co. Ltd. in Buon Ma Thuot city received the second and the third prizes, respectively.

According to the organisers, the competition aims to discover and honour coffee products meeting specialty coffee standards, and to create a motivation for the coffee production industry in increasing the added value of coffee products.

It also offers an opportunity to introduce their specialty coffee products of Vietnam to consumers and producers at home and abroad.

This year’s competition saw the participation of 41 companies and units from Ho Chi Minh City, Hanoi, Son La, Quang Tri, Dak Nong, Gia Lai, Lam Dong and Dak Lak with 45 Robusta and 29 Arabica products.

With a cultivation area of about 5,000 hectares, Huong Hoa district in central Quang Tri province is one of the key areas for Arabica coffee growing in Vietnam. The district is famous both in and outside the country for its Khe Sanh Arabica coffee brand.

It is chosen by the Ministry of Agriculture and Rural Development (MARD) to build a Vietnamese specialty coffee brand with an area of about 60 hectares in Huong Phung commune.

Le Quang Thuan, Vice Chairman of the Huong Hoa District People’s Committee, said the district has been carrying out a number of measures to build specialty coffee brand on the cultivation area selected by the MARD and gradually expanded the model to communes and towns of Huong Hoa district.

Local authorities asked communes and towns to review their existing coffee areas to improve the quality of coffee and propose conversion for inefficient cultivation area.

Recently, the MARD has approved a project on the development of Vietnamese specialty coffee in the 2021 – 2030 period.

The project is in line with the international economic integration process, meeting the growing demand for specialty coffee in both domestic and export markets. It will contribute to enhancing the competitiveness of Vietnamese coffee products in the world market. The project is implemented in eight provinces including Dien Bien, Son La, Kon Tum, Gia Lai, Dak Lak, Dak Nong, Lam Dong and Quang Tri./.

Vietnam remains attractive among foreign investors despite COVID-19

Vietnam is still a popular investment destination for foreign investors, who poured 14 billion USD into the country during the first five months of the year.

With COVID-19 raging, the Regent Garment Factory Ltd., a subsidiary of Hong Kong (China)’s Crystal International Group Limited, still submitted a request to the northern province of Hai Duong to open a new 35 million USD garment factory in the locality. The request was approved last week.

The investment in the third factory confirms the company’s long-term interest in Vietnam.

Five other investors also received investment licences in the southern industrial hub of Binh Duong province. The largest investment came from Taiwan (China)’s Far Eastern Group, with an additional 610 million USD for its Polytex Far Eastern factory, which already has investment of nearly 600 million USD.

Meanwhile, the Cheng Loong Group from Taiwan (China) decided to inject an additional 100 million USD into its 1 billion USD paper factory. The project was licenced in late 2015.

Another big name – Procter & Gamble – has poured 44.8 million USD into a project, raising its investment in Vietnam to 247.8 million USD. At the same time, Singapore’s New Motion Private Company Limited launched a new project worth 184 million USD this year, while the Logistics ECPVN Binh Duong project will have investment of over 34.4 million USD.

A number of other large-scale projects have also received licences since the beginning of this year.

These projects prove that Vietnam remains a favourite destination for foreign investors despite COVID-19. Figures from the Foreign Investment Agency at the Ministry of Planning and Investment show that foreign investment in Vietnam rose 0.8 percent in the first five months of 2021 to 14 billion USD.

Of the total, newly-registered capital stood at nearly 8.83 billion USD, up 18.6 percent year-on-year, while additional investment totalled 3.86 billion USD, an increase of 11.7 percent compared to the same period last year. Investment through capital contributions and share purchases was 1.31 billion USD, down 56.3 percent year-on-year.

According to the agency, the disbursement of foreign investment was up 6.7 percent to 7.15 billion USD.

Experts said Vietnam boasts various competitive advantages in foreign investment attraction.

Its engagement in new generation free trade agreements (FTA), including the Regional Comprehensive Economic Partnership (RCEP), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and the EU-Vietnam FTA has helped it access free markets in 55 countries and territories, including 15 G20 economies, making it more attractive to foreign investors, according to Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc.

Among Vietnam’s advantages, she said, are its stable macro-economy and positive growth amid COVID-19, strong support for foreign investors, and the issuance of a series of key laws regarding investment activities as well as special incentives for large-scale projects.

However, in reality, the foreign investment attraction “race” is becoming fiercer in Southeast Asia, she noted, adding that regional countries also introduce attractive policies to promote foreign investment.

Nguyen Duc Trung, Chairman of the People’s Committee of central Nghe An province, said foreign investors are waiting for a specific foreign investment attraction strategy as well as special preferential policies./.

HCM City’s industrial production up 7.4 percent in first five months

Ho Chi Minh City’s Index of Industrial Production (IIP) rose 7.4 percent year-on-year in the first five months of 2021, according to the municipal Department of Industry and Trade.

Data from the department shows that the five-month IIP of four key industries – electronics, mechanics, foodstuffs and pharmaceuticals – grew 8.5 percent against a year earlier and was over 1.1 percentage points higher than the overall IIP.

Meanwhile, 22 out of 30 Grade-II industries in the city saw their IIP rise, with the highest growth posted in wood processing and the production of wood and bamboo products (up 54.4 percent); metal production (37.8 percent); other processing and manufacturing technologies (32.2 percent); and electrical equipment production (27.1 percent).

According to the municipal Statistics Department, the local index of industrial consumption increased 10.1 percent against 2020.

Industries with a high consumption index included metal production, wood processing and the production of wood and bamboo products, motor vehicles, coke, and refined petroleum products./.

Hanoi attracts 519.2 million USD in FDI in five months

Total registered capital of new foreign-invested projects and additional capital in existing ones in Hanoi amounted to 519.2 million USD in the first five months of this year, according to the Statistics Department of Hanoi.

Specifically, 139 new FDI projects worth 76.8 million USD were licensed in the period, while existing projects absorbed 442.4 million USD.

In May alone, Hanoi gave the green light to 14 wholly foreign-owned projects and two foreign joint ventures, with combined registered capital of 5.3 million USD. Meanwhile, foreign investors poured 184 million USD in operational projects.

Regarding domestic enterprises, 2,238 new enterprises were established in Hanoi in May, up 8 percent year on year, which registered a total 42.3 trillion VND (1.84 billion USD) in capital, up 69 percent.

At the same time, 245 firms dissolved, up 20 percent, and 788 suspended operation, an increase of 28 percent, but 644 resumed operation, a surge of 51 percent./.

Mekong Delta needs momentum to grow further: conference

Tran Tuan Anh, head of the Party Central Committee’s Economic Commission, said on June 1 that solutions are needed to create momentum for socio-economic development in the Mekong Delta.

It is necessary to identify the advantages and challenges in the region’s sustainable development, especially in the new context, he told a conference in Hanoi.

The conference looked at the building of a project reviewing the implementation of Resolution No 21-NQ/TW dated January 20, 2013, on orientations, tasks, and solutions to spur socio-economic development and ensure national defence and security in the Mekong Delta in 2001-2010.

The Politburo has assigned the Economic Commission to coordinate with relevant agencies in assessing implementation.

The Mekong Delta has recorded achievements in many regards, with economic restructuring being on the right track. It has also affirmed its place as Vietnam’s leading centre for rice, aquatic product, and fruit production and export, the conference heard.

However, Anh said, limitations remain, such as slow regional growth, lower living standards than the national average, and economic development yet to match the region’s potential and advantages.

Given this, he stressed, new resources and measures are needed to boost regional socio-economic development./.

Vietnamese rice accounts for 84 percent of Philippines’ rice imports

The Philippines imported close to 800,000 tonnes of rice in the first four months of this year, of which Vietnamese rice accounted for 84 percent.

According to the Philippine Bureau of Plant Industry (BPI), in the January-April period, the country imported about 780,069 tonnes of rice, including 656,133 tonnes from Vietnam.

The Philippines imported 778,986 tonnes of rice in the same period last year.

In a recent report, the US Department of Agriculture (USDA) projected Philippines’ rice imports could reach 2 million tonnes this year, down 18.36 percent compared to the volume in 2020 as the Philippines eyes bigger rice production in 2021.

Earlier, in an executive order, Philippines President Rodrigo Duterte cut the Most Favoured Nation (MFN) tariff rates on rice to 35 percent from 40 percent for in-quota purchases and 50 percent for out-quota volume for one year.

According to the Vietnamese Ministry of Industry and Trade, the Philippines’s lowering tariffs on imported rice would open up opportunities for Vietnam to maintain stable supply of the product for the country and helping it stabilise the domestic market./.

Vietnam among leading smartphone users globally

The nation has been listed among the leading 10 countries in terms of smartphone users by Statista, a search tool used for the purpose of market research.

Statista note that China has more smartphone users than any other country in the world at almost 912 million, whilst India had the second most users with 439 million, less than half that of China.

Among neighbouring Southeast Asian countries, Indonesia came fourth with 160 million smartphone users, followed by the Philippines and Thailand with 41.3 million and 37.8 million, respectively.

This comes after the country came in ninth in 2020 with a smartphone penetration rate of 63.1%, higher than Indonesia at 58.6%, and the Philippines at 37.7%.

Furthermore, Vietnam is also considered to be a potential and fast-growing digital economy in Southeast Asia, with the local digital economy likely to reach US$52 billion in value by 2025.

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

NA Standing Committee convenes 55th session

National Assembly (NA) Chairman Vuong Dinh Hue chaired the 55th session of the 14th NA’s Standing Committee, which was held in Hanoi on April 27 to review the outcomes of the 11th meeting of the 14th NA and give initial opinions on the preparations for the 15th legislature’s first session.

Participants discussed and made decisions on issues related to establishing and adjusting administrative boundaries in the capital city of Hanoi, and the provinces of Thanh Hoa, Dong Nai and Tuyen Quang; the boundary adjustment to expand Hue City of Thua Thien-Hue Province and arrangement of wards in Hue City.

They also debated on plans to use the remaining savings and budget sources of the central budget in 2020, and the supplementary funding for purchasing vaccines, antiseptic chemicals, and national crop seeds.

Deputy PM sends message to 77th Session of UNESCAP

On April 27, Deputy Prime Minister Pham Binh Minh sent a video message to the 77th Session of the United Nations Economic and Social Commission of Asia and the Pacific (UNESCAP) at the invitation of A.S.Alisjahbana, UN Under-Secretary General cum UNESCAP Executive Secretary.

The 77th Session of the UNESCAP was attended by Presidents and Prime Ministers of 18 countries, including the Presidents of Indonesia and Afghanistan and the Prime Ministers of Cambodia and Pakistan. In their remarks, they shared experience in pandemic prevention and control, called for strengthening multilateral cooperation, and suggested UNESCAP continue in its role of coordinating cooperation and information and experience sharing at the regional level.

The four-day session, themed “Building back better from crises through regional cooperation in Asia and the Pacific”, will wrap up on April 29.

Quang Tri: Flag-raising ceremony held to mark Reunification Day

National flag being raised at the Hien Luong – Ben Hai historic site in Vinh Linh District, Quang Tri Province, on April 30, 2021. (Photo: NDO/Lam Quang Huy)

A flag-raising ceremony was solemnly held by the central province of Quang Tri at the Hien Luong – Ben Hai special national monument on April 30 to mark the 46th anniversary of the Liberation of the South and National Reunification Day.

At 7:00 am, the national flag was raised to the peak of the monument while the national anthem was played.

Meetings, art shows and exhibitions were held in localities to celebrate the occasion.

Local authorities also visited and presented gifts to families of contributors to national reunification.

Vietnam’s digital economy to hit US$52 billion by 2025

Vietnam’s digital economy will likely reach US$52 billion in value by 2025, according to the e-Conomy SEA 2019 report by Google, Temasek and Bain & Company.

With the gross merchandise value (GMV) of its internet economy accounting for over 5% of the country’s GDP in 2019, Vietnam is emerging as the most digital economy in the region, the report said.

Last year, the Vietnamese internet economy continued to record double-digit growth, at 16% year-on-year, the highest in Southeast Asia.

The report noted all sectors except travel continued to grow in 2020, of which transport and food, and online media grew 50% and 18%, respectively, compared to 2019. Only online travel dropped 28% in terms of GMV, but is expected to grow 25% by 2025.

Vietnamese scientists among Asia’s top 100: Singapore magazine

The five Vietnamese scientists in the 2021 edition of the Asian Scientist 100 (Photo: vnexpress.net)

Five Vietnamese scientists have been named in the 2021 edition of Asian Scientist 100, an annual listing of the brilliant scientific talents in the region by Singapore’s Asian Scientist magazine.

They are Assoc. Prof. Dr. Tran Thi Thu Ha of Thai Nguyen University, Assoc. Prof. Dr. Vuong Thi Ngoc Lan from the University of Medicine and Pharmacy in Ho Chi Minh City, and Assoc. Prof. Dr. Le Thi Quynh Mai from the National Institute of Hygiene and Epidemiology (NIHE). Assoc. Prof. Dr. Pham Tien Son of Da Lat University and Dr. Nguyen Truong Thanh Hieu from Ton Duc Thang University also made it onto the list.

This year’s list features the achievements of the researchers, innovators and leaders tackling the world’s most pressing issues, from climate change to COVID-19. To qualify for the list, honorees must have won a national or international prize in 2020. Alternatively, they must have a significant accomplishment in scientific discovery or leadership that benefits academia or industry.

First Miss Earth Vietnam launched

The first ever Miss Earth Vietnam was launched during a press conference held in Lac Duong District in the Central Highlands province of Lam Dong on April 28.

The contest’s online preliminary will start from May, while an in-person round will take place in Hanoi and Ho Chi Minh City from August. The semi-final is scheduled for November and the finale a month later.

The Vietnamese version will have four winners at the same time, including Miss Earth, Miss Earth Air, Miss Earth Water and Miss Earth Fire, who will walk home with a prize worth VND 5.6 billion (US$245,000) in total.

Miss Earth will represent Vietnam at the annual international environmental-themed beauty competition and receive additional VND 1 billion from a local business.

Vietnam Day at MGIMO returns to Russia

An art performance at the event (Photo: NDO)

“The Vietnam Day at MGIMO” (Moscow State Institute of International Relations) returned to the Russian capital city on April 29 (local time). The festival was hosted by Vietnamese students at MGIMO in partnership with the institute’s ASEAN Centre.

A highlight of the festival was a workshop on Vietnam in today’s international affairs, which attracted a large number of experts and students of Vietnamese studies from leading universities in Russia.

A trade fair of Vietnamese goods, a photo exhibition on Vietnam’s people and nature, and events introducing Vietnamese culture and cuisine to Russian students were also held as part of the festival.

Phu Quoc among world’s 15 best islands to retire on

Phu Quoc Island of the Mekong Delta province of Kien Giang has been named among 15 best islands in the world to retire on in 2021 by www.travelawaits.com.

Experts covering overseas retirement trends for more than 40 years have released their latest picks, said the tourism website.

Criteria for top 15 list include “the ability to live a simpler, more peaceful life, without breaking the bank,” it added.

The website noted that the relaxed and small island of Phu Quoc may be a bit more expensive to live on than the mainland since goods need to be flown or ferried in.

“Still, it’s appealing to retirees for its many beaches and opportunities for enjoying the outdoors in tropical weather. The snorkelling is excellent!” it affirmed.

The first batch of Thanh Ha lychees was officially exported to Europe under the EU–Vietnam Free Trade Agreement (EVFTA) on June 7.

Currently, the EU, a potential market of about 430 million people, is the fourth export market for Vietnamese vegetables and fruits. This advantage, as well as the import tax exemption and reduction as committed in the EVFTA, will help to increase the competitiveness of Vietnamese fruits compared to markets that do not have an FTA with the EU such as Thailand, China, Malaysia, and Indonesia.

It is expected that the export shipment will reach European consumers in the next 4-5 days. Apart from Thanh Ha lychee, a batch of Luc Ngan lychee (Bac Giang) will also set out to conquer this community of 27 fastidious countries in the next week.

Chung Tri Phong, general director of Pacific Foods, the company is in charge of exporting the lychee, revealed that the company has about three years of understanding and negotiating the procedures for the export of lychee to the EU.

“Right from the beginning of the season, the production management system and monitoring software of the litchi area must be checked by import partners. We also cooperate with many partners to preliminarily process and preserve lychees, ensuring the best condition this fruit reaches consumers in Europe,” shared Phong.

Le Ba Linh, chairman of the Board of Directors of Pacific Foods said that Vietnam’s agricultural products have great potential, especially tropical fruits such as lychee, dragon fruit, jackfruit, mango, longan, and grapefruit. He said that the EU market always wants to experience products from Vietnam as part of the speciality of the lower Mekong region. After litchi, this company will continue exporting jackfruit, dragon fruit, and rice to the EU.

Hai Duong province currently grows lychee on more than 9,000 hectares, of which Thanh Ha district has more than 3,300ha and Chi Linh town has more than 3,500ha with a total output of about 55,000 tonnes. The province currently has 45 litchi areas with a total area of 450ha planted according to GlobalGAP standards and 6,300ha planted according to VietGAP standards. Up to now, 1,000ha have been certified with VietGAP, GlobalGAP, and 8,000ha have been granted export planting area codes.

Industrial developers winning big from rising rentals

Industrial properties continue to be a “bright spot” in Vietnam’s real estate sector, with mounting rental enquiries and increased capital market activity.

2021 is forecast to be another bumper year for the sub-sector, with Vietnam continuing to scoop up global manufacturing relocations, and industrial developers with large land banks are looking forward to an even brighter future, according to the latest report from real estate consultants Savills Vietnam.

The report stated that average occupancy rates have increased significantly since 2018. In the north, average occupancies last year were up to 90 percent in Hanoi, 95 percent in Bac Ninh, 89 percent in Hung Yen, and 73 percent in Hai Phong. The rate in Ho Chi Minh City was 88 percent, Binh Duong 99 percent, Dong Nai 94 percent, Long An 84 percent, and Ba Ria-Vung Tau 79 percent.

Vietnam now has about 260 operational IPs and 75 others under construction. The national occupancy rate averages over 70 percent.

The sudden increase in rental enquires for land, ready-built factories, and warehousing has been accompanied by price escalations in IPs near major cities. In the north, prices in Hanoi of 129 USD per sq m were up 13.1 percent year-on-year, of 95 USD in Bac Ninh were up 9.2 percent, of 83 USD in Hung Yen were up 6.4 percent, and of 96 USD in Hai Phong were up 3.2 percent.

In 2020, HCM City saw rental prices of 147 USD per sq m, while in other southern industrial areas, the price in Binh Duong of 107 USD per sq m was up 4.9 percent year-on-year, of 98 USD in Dong Nai was up 6.5 percent, and of 65 USD in Ba Ria-Vung Tau was up 18.1 percent.

Rising demand for industrial properties gave a major push to overall performance by developers. The Kinh Bac City Development Holding Corp (KBC) reported revenue in excess of 2 trillion VND (87 million USD) in the first quarter of 2021, almost quadrupling the figure in the same period last year. Of this, over 1.9 trillion VND came from land rentals and property transfers, a three-fold increase year-on-year.

The Sonadezi Corporation’s revenue rose 14 percent from January-March to over 1.26 trillion VND, with more than 365 billion VND from industrial real estate, Savills said, adding that other developers such as the Tan Tao Group (ITA), the Becamex Infrastructure Development JSC (IJC), and the Nam Tan Uyen JSC (NTC) also saw high growth in profit during the period.

Vietnam has been drawing up plans since last year for the heavy investment being channelled into developing infrastructure and industrial parks to attract more companies in supply chains. Various incentives, including corporate tax exemptions, have been adopted to acquire a competitive advantage over rivals in the region./.

Budget revenue rises on robust banking, securities, real estate and automobile sectors

The budget revenue increased significantly in the first five months of this year thanks to recovery from 2020 and some sectors seeing strong growth, such as banking, securities, real estate and automobile industries, according to the General Department of Taxation.

Statistics showed that tax collection was estimated to total 575.6 trillion VND (24.85 billion USD) in January – May, equivalent to 51.6 percent of the plan and 114.5 percent of the same period last year.

The General Department of Taxation said that the budget revenue was quite good from the beginning of this year thanks to the fact that some sectors have benefited from the fiscal and monetary policies introduced in 2020 to aid the economy to overcome the COVID19-pandemic.

With good credit and deposit growth in 2020, which contributed significantly to boost the profit of commercial banks, the corporate income tax which banks paid to the State budget increased by 4.5 trillion VND.

The tax collection from transferring property projects also increased by around 6 trillion VND as the property market was robust in many localities nationwide.

Mergers and acquisitions became more robust in the first months of this year after the impacts of the virus in 2020, which pushed up tax revenue by 5-6 trillion VND.

The Government’s policy of reducing 50 percent of registration fees for domestically-produced and assembled automobiles till the end of 2020 also promoted car sales and the automobile production industry.

The development of the securities and real estate market from the beginning of this year also helped increase revenue from real estate registration fees, personal income tax from the transfer of securities and real estate assets.

According to the Vietnam Securities Depository, the number of new accounts opened in the first four months of this year totalled nearly 370,000, increasing by 90 percent against the whole of 2020, bringing the total number of accounts of individual investors to 3.12 million and organisational investors to 15,800.

Director of the General Department of Taxation Cao Anh Tuan said the outbreak of the fourth COVID-19 pandemic wave in Vietnam from late April might affect budget collection in the second half of this year.

Tuan asked for a close watch to be placed on the virus development to work out solutions for effective tax collection in the remaining months of this year.

At the same time, the department would study and propose measures to efficiently implement the Government’s policies extending the deadline for payment of value added tax, corporate income tax, individual income tax and land fees in 2021 to support enterprises to overcome the difficult time./.

Hanoi takes action to raise PCI ranking

The Hanoi People’s Committee recently issued a directive on improving the city’s Provincial Competitiveness Index (PCI) in 2021, given the fact that many of its sub-indexes have tended towards decline even though its overall position in the national rankings has remained unchanged in recent years.

For the third year in a row the capital city stood in ninth place among Vietnam’s 63 cities and provinces in the 2020 PCI rankings, with a total score of 66.93 points, up 1.13 points from 2019.

The rankings were unveiled earlier this year by the Vietnam Chamber of Commerce and Industry (VCCI) and the US Agency for International Development (USAID).

Among the 10 sub-indexes, the capital earned its highest score, 7.93 points, in the “time costs” index, followed by “labour and training” (7.85 points), “entry costs” (6.74 points), and “business support services” (6.68 points).

Hanoi has made efforts to reduce informal charges, promote fair competition, enhance transparency, and boost the proactivity of city leadership.

VCCI Chairman Vu Tien Loc described Hanoi’s continual presence in the top 10 as an encouraging result, according to the Nhan dan (People) newspaper, as the city is one of the two localities with the largest number of enterprises in Vietnam.

Its sustained position and higher score also indicates the city’s stable performance in administrative reform and improvements to its investment and business climate, he said.

Although Hanoi is viewed by many enterprises as having a good investment and business climate, the unchanged ninth place, with some sub-indexes falling, has stopped the city from reaching a higher position in the rankings, the newspaper pointed out.

For example, its “policy bias” sub-index rose from 5.39 points in 2019 to 6.06 points last year, but it ranked just 52nd among the 63 localities in this regard. “Proactivity of provincial leadership” increased only 0.1 percent to 6.06 points, putting the city at 44th place in this index.

Meanwhile, the city experienced a substantial fall in two important sub-indexes: “entry costs” (down 51 places to 61st) and “access to land” (down 15 places to 56th).

Even the “labour and training” sub-index fell slightly, by 0.06 percent to 7.85 points, ranking fourth nationwide, Nhan dan noted.

To raise the PCI ranking, the Hanoi People’s Committee has issued Directive No 14/CT-UBND on improving the city’s PCI performance in 2021.

The committee demanded that departments, sectors, and district-level authorities invest resources in dealing with the sub-indexes experiencing a downward trend and those ranking “low” or “mid-low” last year.

They were told to take drastic measures to raise the indexes of “entry costs” and “access to land”, which plunged last year.

In particular, they need to have all business registration dossiers handled online, ensure the settlement of business registration procedures completed on schedule or ahead of schedule, publicise such procedures, increase the training of civil servants to boost the quality of guidance provided to people and enterprises, and press on with streamlining land-related administrative procedures.

The northern province of Quang Ninh retained its top position in the 2020 PCI rankings, followed by the southern provinces of Dong Thap, Long An, and Binh Duong.

The PCI report has been published annually by the VCCI and the USAID since 2005 to assess the ease of doing business, economic governance, and administrative reform efforts by city and provincial governments to promote the development of the private sector.

Based on data collected from enterprises, the PCI is viewed as “the common voice” of the business community on the level of reform in various fields./.

Enterprises in Bac Giang, Bac Ninh, and Haiphong thirst for workers

Numerous enterprises such as Fuyu Precision Component Co., Ltd. and Silex Vietnam Co., Ltd. in Bac Giang and Bac Ninh provinces and Haiphong are lacking employees due to the impact of the COVID-19 pandemic.

Currently, there are 3,000 workers working at three manufacturing facilities of Foxconn in IZs in the two provinces. All of them are living in dormitories of the group and commute to the facilities by shuttle bus. Before the pandemic outbreak in the provinces, the company had 12,000 employees at these facilities.

Meanwhile, the representative of Fuyu Precision Component Co., Ltd. said that the company is in need of a large number of employees and has proposed the province to allow its employees in isolation to return to work under strict management. The leaders of the company committed to complying with all regulations to ensure safety for their employees.

Silex Vietnam in Quang Chau IZ is also struggling to maintain operations because its employees are afraid to come back to work until they receive confirmation from the districts and communes that they are are not COVID-19 positive and that it is safe to return to work.

As of now, 11 enterprises in IZs of Bac Giang (including two Foxconn facilities and Silex) have been allowed to resume operations with a total of 5,007 employees.

In Haiphong, Crystal Sweater Vietnam Co., Ltd. in Trang Due IZ said that the company has been receiving stable orders since the beginning of this year, however, 300 of the company’s workers are isolated, impacting production progress.

The shortage of workers is also a problem at Maple Co., Ltd, JASAN, Canadian Solar in VSIP, Primzen, Vinamode, and Yazaki Haiphong Vietnam in Trang Due IZ.

Pegatron to pour additional $101 million into Vietnam investment

The Taiwanese government has given the nod to Pegatron Corporation to pour an additional $101 million investment in Vietnam.

The news was announced by the Taiwanese Ministry of Economic Affairs’ Investment Commission, which is responsible for the approval of foreign investments by Taiwanese companies. Pegatron’s investment in Vietnam will specialise in th emanufacturing and trade of computers and peripheral equipment, communication equipment, and electronic components.

It was reported in last September that Pegatron Corporation, one of the world’s five largest electronic parts and component manufacturers, was seeking to invest $1 billion in Vietnam, and proposing to develop a plant in the northern region.

Petragon plans to manufacture computing, communications, and consumer electronics, in addition to moving its research and development centre from China to Vietnam, according to a source from the Ministry of Planning and Investment.

Pegatron is a key supplier to Apple, along with Taiwan’s Foxconn and Wistron Corporation. Petragon established local subsidiary Pegatron Vietnam Co., Ltd. in March last year. In October 2020, the company was awarded an investment certificate to develop a $481 million factory to produce gaming equipment, phone accessories, smart speakers, game controllers, and all kinds of computers in Haiphong.

Proposing urgent vaccination for retail workers

As workers at retail distribution establishments such as supermarkets, convenience stores, and traditional markets are easily exposed to the COVID-19 pandemic, they need to be given priority for vaccination.

Olivier Bernard Langlet, CEO of Central Retail in Vietnam expressed that the donation commits to its vision of contributing to Vietnam’s prosperity and enhancing the quality of life of the people.

Do Thang Hai, Deputy Minister of Industry and Trade has just signed Official Dispatch No.3150/CV-BCT recommending the prime minister to give priority to vaccination against COVID-19 for employees at the retail distribution system.

The Ministry of Industry and Trade said that adding retail workers to the priority list for vaccination would protect those at a high risk of infection. Because this is a group that has to deal with millions of customers every day while maintaining the supply of essential goods to serve people at all levels.

Accordingly, the Ministry of Industry and Trade requested the health sector to assist in sourcing vaccines, guide import procedures, and organise injections for workers at retail distribution businesses that need to be vaccinated against COVID-19 pandemic using the financial resources of the businesses.

Earlier, many associations and businesses in the manufacturing fields such as textiles, apparel, footwear, seafood, or electronics also wanted to be prioritised for vaccination because most of them are businesses with a large number of employees in industrial zones.

Le Tien Truong, chairman of Vietnam National Textile and Garment Group (Vinatex) said that many textile and garment businesses have signed orders until the end of the year. If the company cannot guarantee workforce for production and delivery on time, businesses will be fined for cancelling orders, causing billions of dollars worth of damage to the whole industry. He highlighted the need for these employees to receive priority in accessing vaccines, especially businesses in high-risk localities such as Bac Ninh, Bac Giang, Ho Chi Minh City, and Hanoi.

“Vinatex businesses are willing to pay to vaccinate their workers. As calculated, businesses under Vinatex will spend VND100 to 200 billion ($4.35 to 8.7 million) to vaccinate their workers,” he added.

In a document recently sent to the prime minister, the Private Sector Development Research Board (IV Board) also proposed to allow businesses to organise COVID-19 vaccination for employees according to the instructions and safety requirements of the Ministry of Health (MoH).

The IV Board also proposed allowing private businesses and organisations to actively negotiate buying vaccines with global suppliers, based on the list of vaccines accepted by the Ministry of Health. Besides, the vaccination force should also be considered and expanded to meet the requirements of mass and large-scale vaccination by mobilising not only vaccination facilities but also qualified hospitals and medical centres according to the regulations of the MoH.

Merger could lead to “GoTo” app for all

The recent merger between Gojek and Tokopedia to create technology powerhouse GoTo Group is expected to heat up Vietnam’s digital platform market.

Specifically, the new group features a wide range of services including ride-hailing, food delivery, e-commerce, logistics, and also financial services.

Gojek Vietnam under GoTo has offered ride-hailing, food delivery, and logistics. To expand its presence in the market, the group will roll out car-sharing and cashless payment services this year. By adding the two new services, Gojek Vietnam is expecting to gain a competitive edge over its rivals in the fast-growing market.

A representative of Gojek Vietnam told VIR that the company has already secured a licence for 4-wheel riding hailing service GoCar in Ho Chi Minh City. The company will be launching GoCar in the next few months, with Hanoi in its sights after Ho Chi Minh City.

After Gojek Vietnam has built a strong foundation there, the company expects to expand to other cities. Meanwhile, cashless payments will also be launched within this year.

Following the GoTo deal, Gojek has more resources and capital to implement expansion plans in Vietnam. According to Ralf Matthaes, managing director of technology-driven market research company Infocus Mekong Research, the key to all online platforms is growing their customer base and offering, thus the new merger should aid in this pursuit.

“Specifically, it will allow its present customer base more services and also erode competitor services, if it can perform well across more new services. For the consumer this is great news, as it should start a price war, at least temporarily, and also force the likes of Grab to up its game in Vietnam,” Matthaes added.

The Gojek and Tokopedia merger may provide food for thought for key platforms in Vietnam. It is not only a ride-sharing and food delivery battle but also an e-commerce game as GoTo is combining Gojek’s on-demand services and Tokopedia’s e-commerce expertise. As Gojek Vietnam is introducing most key services here, there is likelihood that it will add e-commerce into the market at some point in the future.

Commenting on this, Matthaes said that both Lazada and Shopee are rather entrenched in Vietnam, so GoTo may require more time to penetrate the e-commerce space than ride sharing.

Meanwhile, Peh Quan Yao, research analyst of services and payments at Euromonitor International, told VIR that both Gojek and Tokopedia plan to operate separately but leverage each other’s complementary strengths. There is scope for an end-to-end e-commerce solution that leverages an existing tried-and-tested platform in Tokopedia, and Gojek’s last-mile delivery fleet and digital wallet capabilities.

However, Yao noted that the competitive landscape is unlikely to change much for ride-hailing in Vietnam, given Gojek and Grab’s dominant positions. For e-commerce, it is too early to tell. GoTo will be a new entrant with no large-scale operating experience outside of Indonesia. In the near term, challenges like customer and merchant acquisition, optimising delivery and fulfilment operations, and adapting to consumer preferences such as cash-on-delivery and live-streaming need to be addressed to compete with incumbents such as Shopee and Tiki, which have already done well in the market.

According to Euromonitor International, e-commerce made up for just 3 per cent of Vietnam’s retail market in 2020, the lowest amount in Southeast Asia. Meanwhile, the country’s digital economy is forecast to grow to $52 billion by 2025, an annual 29 per cent increase from 2020, according to a study by Google, Temasek, and Bain & Company.

KIDO to open a thousand Chuk Chuk coffee and milk tea shops

KIDO Group today announced its plan to launch its own coffee and milk tea brand Chuk Chuk with the goal of opening 1,000 outlets by 2025.

The stores will serve ice cream, tea, milk tea, coffee and other beverages under TTV Trading Investment JSC – a member of KIDO Group. With a total investment capital of VND100 billion ($4.35 million), KIDO will hold 61 per cent of the controlling stake at the chain to inject investment capital and scale up operations in the future.

At the same time, Chuk Chuk will team up with foreign partners to extend its reach to the Asian market between 2021 and 2023. Tran Tuyet Van, one of the three daughters of Tran Le Nguyen is the general director of Chuk Chuk.

Chuk Chuk will be developed with a variety of business models including a system of stores, trolleys, and kiosks deployed on main roads and in commercial centres.

2021 will be a crucial year for Chuk Chuk to develop a system of stores, kiosks, and trolleys in Ho Chi Minh City with the goal of developing 58 stores by the end of the year.

Accordingly, the first Chuk Chuk stores in Ho Chi Minh City will open in June, while the kiosk and trolley system is expected to launch a month later. In the next 2-3 years, Chuk Chuk will make its debut in Hanoi and other big cities in Vietnam.

In addition to beverages, Chuk Chuk also sells fresh bakery under KIDO’s Bakery brand, as well as tea and coffee packages, glasses, and souvenirs.

Leflair rumored to get new owner after bankruptcy filling

The e-commerce market is heating up following the news of e-commerce brand Leflair making a return under the wings of a new investor.

It is said that the investor behind Leflair is a US tech firm that has been operating in Vietnam for three years now with a track record of many successful mergers and acquisitions (M&A) deals involving local small and mid-sized tech firms.

Leflair is an e-commerce platform that provides genuine branded products at a discount. The e-commerce platform official debuted in 2015 and quickly left an impression in the market with its business model of an inventory business rather than a marketplace. Specifically, Leflair keeps products from suppliers in its warehouses. To ensure the quality of the products, it developed two warehouses in Singapore and Hong Kong (China) with a strict inspection and management system.

In Vietnam, Leflair has become a reputable shopping site for luxury brands among middle-class customers. Following its inception in Vietnam in 2015, Leflair entered into partnerships with 2,500 brands and extended its reach to Singapore and the Philippines. By 2019, the e-commerce platform served over 120,000 customers a year, posting net revenues of up to dozens of million dollars per year with the highest average order value in Vietnam’s e-commerce market.

The startup bringing Leflair to Vietnam quickly achieved success and easily raised capital thanks to its strong business model built on flash sales. In its first few years, Leflair made a big splash in the local e-commerce market before filing for bankruptcy in May 2020. In March 2021, bankruptcy proceedings were opened, confirmed by the court’s approval of bankruptcy proposal.

While Leflair has yet to make an official announcement regarding its new owner, customers are excited about rumours of their once beloved e-commerce platform returning to the market. Meanwhile, old partners looking for partnership opportunities are also wondering what the return would bring: even as Leflair’s sudden bankruptcy declaration was a source of various difficulties, its return may open up new opportunities.

The startup owning Leflair filed for bankruptcy in May 2020 and then received legal approval. So far, Leflair has transferred the ownership of its trade name and intangible assets associated with the Leflair trademark to a new investor in accordance with international law.

This M&A deal is made between the new investor from the United States and the owner of the Leflair brand, a corporation headquartered in Hong Kong. It is known that the new investor will soon launch the Leflair brand in the market with a view to make full use of the familiarity of the brand to revive the Leflair e-commerce platform. The new investor also focuses on investment and business activities by combining the new platform and operating system as well as selecting suppliers with high-quality and genuine products to offer customers professional service.

Leflair is a familiar name but it has been fully acquired and is now operated by a new owner who is not legally responsibly for any activities by the previous owner whose bankruptcy proceedings were approved by the law.

PM approves 2021-2023 public debt management programme

The Prime Minister has recently approved a public debt management programme for the 2021-2023 period.

The local budget spending deficit is limited at 0.2% of GDP, as stipulated in the 2015 Law on State Budget, and the debt repayment obligation of local governments is approximately VND18.4 trillion (US$801.8 million).

With regards to foreign commercial loans by enterprises and credit institutions, the growth rate for short-term credit is capped at 18-20% per year and the net maximum medium-term and long-term loans are around US$6.35-7 billion per year.

For 2021, the government is expected to borrow VND624.221 trillion (US$27.2 billion), including VND527.357 trillion (US$23 billion) from domestic sources and VND96.864 trillion (US$4.2 billion) from foreign lenders.

Of this figure, VND579.772 trillion (US$25.3 billion) will be used to balance the central budget while the remaining VND44.449 trillion (US$1.9 billion) will be spent on lending to other borrowers.

The government is expected to repay debts of VND394.506 trillion (US$17.2 billion) in 2021.

Vietnamese tourists increasingly favour sustainable tourism

Vietnamese tourists have expressed their wish to choose ecotourism (59% of participants), limit single-use plastic on flights/at lodges (57%) and encourage financial rewards for accommodation facilities that maximise energy efficiency (40%) towards more sustainable tourism in the post-COVID-19 period.

This is part of the results of a survey on Sustainable Tourism Trends just released by Agoda on the occasion of the World Environment Day (June 5).

Agoda, a digital travel platform offering a global network of 2 million properties across more than 200 countries and territories around the world, conducted a survey on sustainable tourism and pointed out the leading solutions for the sustainable development of the tourism sector.

According to this survey, the top measures consist of the provision of more eco-friendly travel options, the reduction of single-use plastics and the offering of monetary rewards to accommodation providers who use energy-saving measures. In the rankings of positive solutions to make tourism more sustainable, many other useful methods, such as the establishment of nature reserves to limit tourist numbers and the elimination of disposable bathroom products, were highlighted.

The top concerns in Vietnam were overcrowding (28%) and deforestation for tourism (24%). Survey respondents said that many Vietnamese people expressed their hope that hotels and other accommodation providers will switch to using water and renewable energy sources and reduce their reliance on single-use plastic products.

The current trend of Vietnamese tourists is to give preference to pristine and little-known attractions as well believing the Government and travel agencies need to share the responsibility in ensuring sustainable tourism.

Along with Thailand, Indonesia, the Philippines and China, Vietnam is also a top tourism market committed to cleaning up beaches.

Similarly, actual statistics from many countries around the world show that people believe the Government should take the main responsibility for creating positive change in respect of the environment and tourism activities, followed by agencies and enterprises and then individuals. Up to 36% of people in Indonesia and the UK, 33% of Chinese people and 28% of Australians share this view.

On the other hand, other people around the world believe individuals must play the most important role in promoting the sustainable development of tourism.

Although there is no one-size-fits-all answer, people worldwide affirmed that actions contributing to enhancing sustainable or eco-friendly tourism will protect the environment more effectively in the near future.

Regarding the commitment to help tourism sector develop better during post COVID-19 period, almost all survey respondents answered that the management of single-use plastic is a top commitment, followed by turning off air conditioners and lights when not in use and developing eco-friendly accommodation.

CEO of Agoda John Brown said that simple measures to promote sustainable tourism such as turning off lights and air conditioners when leaving the room and reducing waste by limiting the use of single-use plastics are now favoured by tourists around the world.

Despite the many different interpretations of eco-friendly activities and sustainable tourism, most travelers want to choose eco-friendly accommodation and make smart choices for their travels.

Local firms boost processed mango exports to U.S.

Due to difficulties in exporting Vietnam’s fresh mangoes, many firms have invested in processing to boost the consumption of processed mangoes in foreign markets, mainly the United States.

In the first three months of the year, Vietnam was the United States’ 13th largest mango supplier, according to the Import-Export Department under the Ministry of Industry and Trade.

During the three-month period, the U.S. increased its import of dried mangoes and mango juice from Vietnam. Vietnam shipped 97 tons of mango juice worth US$102,600 to the American market, skyrocketing by 340% in volume and 160.5% in value year-on-year. The country’s export of dried mangoes to the United States reached 68 tons worth US$83,000.

Despite the modest volume, fostering the export of processed products is a growth trend for Vietnamese mango, said many firms.

Nguyen Dinh Tung, general director of Vina T&T Group, told the Saigon Times that the export of fresh fruits, including mango, had faced multiple difficulties due to high transport costs and the prolonged transportation time, while fresh fruits also have a short shelf life. Besides, many countries have erected technical barriers to fresh fruits to protect local products and customers, he said.

Taking the U.S. market as an example, he said that in the past, it took 20-23 days to ship goods by sea from Vietnam to the market, but now, the transport time is 30-35 days. Meanwhile, Vietnam’s preservation technology keeps mangoes fresh for a mere 30 days.

“Sometimes, the fresh mangoes arrived in the U.S. market, but reached the expiration date and were not sold to customers,” Tung said.

Dang Phuc Nguyen, general secretary of the Vietnam Fruit and Vegetables Association, said that since 2020, when the Covid-19 pandemic emerged, many fruit exporters have sought ways to adapt to the new market situation.

Due to high transport costs and the shortage of containers, many firms which specialize in exporting fresh products have shifted to processed products for shipments.

“Processed mangoes have a longer shelf life than fresh ones and do not face severe competition from the products of other countries,” Nguyen said.

Statistics indicated that in 2020, Vietnam shipped some US$800 million worth of processed vegetables and fruits to the United States, accounting for 25% of the total value of veggie and fruit exports, while the proportion was 10%-15% in 2019.

In addition, Europe and other countries are raising their consumption of Vietnam’s processed fruit, mainly dried mangoes and mango juice, urging many local exporters to upgrade and improve their machines and technology and expand production to ramp up the capacity of processing fruits and meet demands.

“This year, Vietnam’s export of processed fruits, including mangoes, is expected to soar by 30% against last year,” said Nguyen.

Vietnam shipped an estimated US$400 million of vegetables and fruits to foreign countries in May, up 48.3% year-on-year, sending the country’s export value of these products in the first five months of the year to US$1.77 billion, up 18% year-on-year.

In 2020, Vietnam exported 2,100 tons of mangoes worth US$4.6 million to America, up 66% in volume and 70% in value against 2019, while the latter bought 1,150 tons of frozen mangoes from Vietnam, up 38% from the 2019 figure.

Vietnam’s insurance market growing rapidly

Vietnam’s insurance market has grown significantly faster than other countries in the region and the world. The growth rate is maintained for a long time, regardless of the world financial crisis or other damaging impacts.

According to the Government’s report on the revised Insurance Business Law project which the Ministry of Justice has been appraising, Vietnam’s insurance market has grown significantly faster than other countries in the region and the world from 2000 to 2020. The growth rate is maintained for a long time, regardless of the world financial crisis or other negative impacts.

Currently, about 72 insurance enterprises are operating in Vietnam. Among 72, some are non-life insurers while others are insurance brokers and reinsurance companies.

Total assets of the whole market grew by an average of 24 percent annually, reaching VND573,233 billion (US$25 billion) in 2020, of which assets of non-life insurance enterprises reached VND99,340 billion while life insurance enterprises reached VND 473,893 billion.

Total money insurance companies investing in other sectors grew at an average of 24 percent a year, reaching VND468,125 billion in 2020. Of the funds, non-life insurers have poured VND 52,278 billion into other sectors while life insurance enterprises poured VND415,847 billion.

In addition, insurance premium revenue averagely increased by 19 percent a year, reaching VND87,211 billion in 2020. Of these, premium revenue from non-life insurance enterprises reached VND 56,654 billion, and life insurance enterprises reached VND130,557 billion.

Equity of insurance enterprises roughly increased by 38 percent a year, reaching VND127,842 billion in 2020. Of the amount, equity of non-life insurance enterprises reached VND33,516 billion and insurance enterprises for life expectancy reached VND94,326 billion.

By the end of 2020, the insurance market has offered nearly 1,000,000 jobs with stable income. Moreover, employees are trained in finance and insurance. According to statistics of insurance companies, the total insured value is VND11.7 quadrillion.

Currently, about 11.9 million Vietnamese people are buying in life insurance, equivalent to more than 10 percent of the country’s population. Four million people have bought health insurance and short-term health insurance while 12 million students have participated in accident and health care insurance.

Additionally, 18 million passengers and 12 million passengers are insured by aviation and railway accidents while 1,620 million passengers are covered by road accident insurance companies.

Telefilm goes virtual for 2021 edition

Vietnam International Exhibition on Film and Television Technology – Telefilm 2021 have been held online from June 7-30 due to the Covid-19 outbreak.

Exhibits include Content Production Program, TV advertising, TV formats, technology and equipment in the broadcast industry as well as related services and products.

The exhibition is also an opportunity for insiders to exchange and share experiences and seek partners as well as promote Vietnamese Film and Television industry to international visitors.

Deal signed to promote farm produce sale via digital platforms

A memorandum of understanding was signed in Hanoi on June 8 to carry out a programme on facilitating digital transformation and assisting small- and medium-sized enterprises, cooperatives and business households in the consumption of farm produce in the country.

Signatories were the Ministry of Planning and Investment (MoPI)’s Agency of Enterprise Development, the Ministry of Agriculture and Rural Development’s Agro Processing and Market Development Authority, the Vietnam Cooperative Alliance’s Centre for Trade Promotion and Investment, and Grab Vietnam.

In the immediate future, the programme will help with farm produce sale via digital platforms in localities hit by COVID-19 or those under lockdown, including experimenting on Grab.

Practical activities will be also held to raise awareness of digital transformation among businesses, cooperatives, business households and farmers.

The activity is also part of the programme to assist firms in digital transformation for the 2021-2025 period launched by the MoPI.

Earlier, Grab announced the GrabConnect project to connect farmers with consumers nationwide to consume farm produce and safe local specialties.

GrabConnect also launched the first scheme to help consume 300 tonnes of Luc Ngan lychees in Bac Giang province via Grab’s ecological system./.

Northern mountainous region should turn disadvantages into development advantages: Official

Tran Tuan Anh, Politburo member and Chairman of the Party Central Committee’s Economic Commission, on June 8 urged northern midland and mountainous provinces to turn their disadvantages into advantages to serve development.

Speaking at a conference in Hanoi, Anh highlighted the northern midland and mountainous region’s strategic location in economy, social affairs, national defence-security, and foreign relations of the whole country.

Aware of its important role, the Politburo issued Resolution No. 37-NQ/TW dated July 1, 2004 and Conclusion No. 26-KL/TW dated August 2, 2012, to promote socio-economic development and ensure national defence and security in the region, he said.

Over the past two decades or so, the region has achieved notable socio-economic achievements.

However, it still remains the country’s poorest and most disadvantaged region, he went on, with low per capita income and high poverty rates, especially in ethnic minority areas.

Anh asked ministries, agencies, and localities to analyse the advantages and challenges, especially in the new context, during the implementation of the above-mentioned resolution.

Comprehensive tasks and solutions are needed to create momentum for the localities to move ahead, he stressed.

Participants suggested issuing a new resolution on socio-economic development and national defence and security in the region by 2030 with a vision towards 2045 in the new setting.

They cited development orientations for the region as set out in the Resolution of the 13th National Party Congress, focusing on forest protection and restoration, mining, the border economy, inter-regional connectivity, and community-based and eco-tourism./.

Teleconference discusses consumption of Bac Giang lychees

A teleconference linking 29 locations at home and abroad was held on June 8 to discuss lychee consumption this year.

The gathering was co-organised by the Bac Giang provincial People’s Committee, the Ministry of Industry and Trade, and the Ministry of Agriculture and Rural Development.

Addressing the conference, Minister of Industry and Trade Nguyen Hong Dien hailed Bac Giang for selling lychees via e-commerce platforms, saying this is the right approach amid the COVID-19 pandemic.

The Bac Giang lychee trademark is currently protected in eight countries: China, the US, Japan, Australia, the Republic of Korea, Singapore, Laos, and Cambodia.

Earlier, in March, it became the first Vietnamese farm produce to receive geographical indication protection in Japan, paving the way for it to navigate other promising markets.

Chairman of the provincial People’s Committee Le Anh Duong said Bac Giang has identified three scenarios for selling lychees this year while working closely with foreign partners and cities, provinces, and merchants to sell other farm produce.

Over 1,500 trucks together with workers are ready to transport and sell lychees, he went on. Sales have proceeded smoothly so far.

Bac Giang’s lychee output is estimated at 180,000 tonnes this year. As of June 7, more than 53,000 tonnes had been sold at home and abroad.

On the occasion, a ceremony was also held to announce a certificate of geographical indication from Japan for Luc Ngan lychees, while stalls selling local lychees were also launched on domestic and foreign e-commerce platforms./.

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