VIETNAM BUSINESS NEWS JULY 7

Blockchain Global Day 2022 will be held in Ho Chi Minh City on July 29, with the theme of “Into the Infinity Con-verse”, organisers said on July 7.

This is the first event in a series of the annual blockchain exhibitions intended to maximise conditions to facilitate the development of the industry in Vietnam.

Organisers said ample room remains for Vietnam’s blockchain, citing its application by major domestic businesses and banks like FPT Software, Military Industry and Telecoms Group (Viettel), the Bank for Investment and Development of Vietnam (BIDV), and the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), among others.

Huynh Kim Tuoc, Sihub Managing Director, said Blockchain Global Day 2022 will feature 100 booths introducing blockchain projects and two seminars on the integration of blockchain into global technological trends like Web3, Metaverse and NFT.

The event is expected to bring together representatives from prestigious projects and experts in this field in Southeast Asia such as Binance, YGG SEA, Coin98, Vina Capital Ventures and Coinex.

HOSE announces list of top 10 securities companies
     
The Ho Chi Minh City Stock Exchange has announced the top 10 largest securities companies this year.

VPS Securities Joint Stock Company remained in top spot with a 17.59 per cent market share in the first half of the year though its second quarter share dipped marginally.

SSI Securities Corporation continued to be in second position, but increased its market share from 9.66 per cent in Q1 to 10.02 per cent in Q2 to end the half with 9.81 per cent.

VNDirect Securities Corporation remained in third place with 7.99 per cent during the year.

In the top 10 Ho Chi Minh Securities climbed past Techcom Securities JSC to fourth position in Q2, with their half-year market shares being 5.58 per cent and 5.47 per cent, respectively.

Mirae Asset, Viet Capital Securities JSC, MB Securities, KIS Vietnam Securities, and FPT Securities rounded off the top 10.

Hai Phong striving to attract over 2.5 billion USD in FDI this year

For the last half of 2022, Hai Phong city will apply itself to flexibly and effectively fighting COVID-19 and shoring up business and investment activities so as to attract more foreign direct investment (FDI), a local official has said.

Nearly 1.1 billion USD of FDI was poured into the northern port city in the first six months, falling by over 11% from a year earlier and equivalent to almost 44% of this year’s target.

FDI inflows are expected to stand at 0.85 billion USD in the third quarter and 0.85 – 1.1 billion USD in the fourth quarter.

Le Trung Kien, head of the Hai Phong Economic Zone Authority, said the city looks to surpass this year’s FDI attraction target of 2.5 billion USD.

To that end, the authority will boost investment promotion and attraction for the three pillars of economic development, namely high-tech industry, seaports – logistics, and tourism – trading.

HSBC upgrades Vietnam’s growth forecast to 6.9%

HSBC has raised its forecast for Vietnam’s economic growth this year to 6.9%, from the previous prediction of 6.6%, which is possibly the fastest pace in the region.

In the Vietnam At A Glance report in July, HSBC Global Research noted that decreasing risks posed by the Omicron variant and eased restrictions have paved the way for Vietnam to return to the normality.

Thanks to widespread recovery, the country recorded an impressive GDP growth rate of 7.7% in the second quarter compared to the same period last year. The service sector, which has suffered from severe economic impacts, have bounced back strongly while manufacturing has continued growing and exports hit historic highs.

However, the growth forecast for 2023 was revised down to 6.3% from 6.7% due to growing risks, especially in the energy sector, according to the bank.

HSBC Global Research pointed out growing impacts of soaring energy prices. Escalating goods prices have led to trade deficit in Q2 and may worsen the current account situation, which has not already been optimistic. On the other hand, though household consumption has recovered steadily, people’s budgets may suffer from high oil prices, thus decelerating the recent recovery speed.

Vietnam’s inflation is forecast to stand at about 3.5% this year, but it may surpass the ceiling of 4% between Q4 of 2022 and Q2 of 2023, requiring the State Bank of Vietnam begin normalising the monetary policy.

According to the report, Vietnam has benefited from economy reopening, and domestic demand has returned while external drivers remain favourable. However, it is necessary to stay alert to increasing growth risks, especially the ones posed by surging energy prices.

Banks to have credit expansion at end-Q3 2022

Banks are forecast to have a credit expansion at the end of the third quarter of 2022, according to Saigon Securities Incorporation.

As demands for bank loans have increased rapidly this year after the pandemic has been controlled, banks have already used up most of their assigned quota this year. The banks have therefore proposed the State Bank of Vietnam (SBV) to appropriately expand their credit growth quota to continually lend to customers.

Under the current regulations, the SBV sets credit growth limits for each commercial bank at the beginning of the year depending on the bank’s health, including capital adequacy ratio, financial strength, risk governance and operational status. This was done to control credit growth of the entire banking system and to ensure money supply and inflation control as targeted by the Government.

The SBV has also said the extension of the credit growth quota will be implemented at an appropriate time and the adjustment will depend on the financial health of each bank.

According to the SBV’s deputy governor Dao Minh Tu, from the beginning of the year when setting the credit growth target at 14% in 2022, the SBV said it could flexibly adjust the target depending on the actual situation.

As banks said they have all used up their credit growth quota and cannot accelerate lending, Tu said the current situation is also an opportunity for banks to restructure their credit sources, noting the SBV’s goal is to direct capital into priority areas and strictly control credit to risky areas.

Kyushu – Vietnam Business Association makes debut

The Kyushu – Vietnam Business Association (KVBA) officially made debut at a recent ceremony held in Fukuoka city of Japan.

The KVBA, comprising 25 member enterprises of both countries, is tasked with providing economic information for its members; organising business matching workshops and conferences; helping businesses survey markets and open branches, representative offices, and manufacturing establishments in each other’s countries; and arranging fact-finding trips, among others. The KVBA will act as a voluntary and non-profit community connecting organisation.

Vietnamese economy to perform well: AMRO

Vietnam is expected to come out second only to the Philippines in terms of projected GDP for 2022 and on top for 2023, according to a recent Quarterly Update of the ASEAN+ 3 Regional Economic Outlook.

Specifically, the country was projected to achieve a growth rate of 6.3% this year and 6.5% next year, well above the region-wide figures which were estimated at 4.3% and 4.9% respectively.

Compared to the previous update, Vietnamese growth rates were revised downwards to reflect the lower growth forecasts for China and the US, its major trade partners. The country was expected to top the list with growth rates of 6.5% and 7.0% in the April update.

The Russian military operations in Ukraine have been pushing up commodity prices and global inflation. Relentless cost-push pressure, coupled with firming domestic demand, is expected to drive regional inflation higher this year, at 5.2%.

Regional inflation is projected to moderate to 2.8% in 2023 as tight monetary policy taken by various economies will take effect and the pandemic is showing signs of receding. 

AMRO expects that Vietnam will keep inflation rates well below 4% by means of price control. It estimates the figures at 3.5% in 2022 and 3.3% in 2023.    

A sharper deceleration in China’s consumption and realty activities, according to AMRO, would significantly drag down the economy, with spillovers that would further undermine regional outlook. 

Additionally, mounting prices in the US have caused the Federal Reserve to adopt contractual monetary policy at a faster pace than expected, raising concerns of an imminent recession. Financial investors have switched to safe assets and risk aversion has spiked, leading to capital outflows from emerging markets.

Vietnamese tech firms expand cooperation for “Made in Vietnam” products

Vietnamese tech firms should expand cooperation in research and development (R&D) and technology transfer to be able to make electronics, information technology and telecommunications (ITC) products branded “Made in Vietnam”, experts said at a conference on July 5 in HCM City. 

Ho Quynh Hung, chairman of the Board of Directors of Dien Quang Joint Stock Company, said that Vietnam’s electronics and ITC industries remain dependent on imports due to a lack of high-tech production capability. The industries also lack design and R&D capacity, he added.

The number of Vietnamese companies making chips and electronic components for production of electronic and ITC products remains modest and most foreign companies open factories in Vietnam to produce chips and electronic components, he added.

According to the Ministry of Information and Communications, the total revenue of the ITC industry in 2020 reached 120 billion USD in 2020. Of that number, the hardware industry accounted for over 107 billion USD, the software industry over 5 billion USD and the digital industry over 900 million USD.

According to the Industrial Planning by 2030, the annual growth of the electronics industry was 17-18% in the 2016 – 2020 period and would reach 19-21% by 2030. 

At the event, Dien Quang and XeLex signed an agreement to research, design and produce electronics, ITC and 5G equipment “Made in Vietnam”. Under the agreement, Dien Quang will provide components used to make tablets, laptops, servers and other products of electronics and ITC by XeLex.

Unemployment, underemployment drop in H1

The number of unemployed people in Vietnam stood at nearly 1.1 million in the first half of 2022, down 47,600 year-on-year, said an official from the General Statistics Office (GSO) at a press conference on in Hanoi on July 6.

There were around 410,300 people aged 15 – 24 without a job during the period, accounting for 36.8% of the total figure, Pham Hoai Nam, Director of the GSO’s Department of Population and Labour, told the press conference held to announce the Q2 and H1 labour market updates.

The unemployment rate among persons of this age group living in urban areas was 9.21%, a year-on-year drop of 0.76 percentage point, he added.

Both unemployment and underemployment rates declined in Q2 compared to the previous quarter and the same period last year, GSO Deputy General Director Nguyen Trung Tien said.

The Q2 employment went up quarter-on-quarter and year-on-year, with a considerable rise reported in the service sector, Tien noted, adding that monthly average wage per person also increased.

Data from the GSO shows that the underemployed population was estimated at over 1.1 million, a year-on-year decrease of 30,200. The underemployment rate in urban areas stayed at 1.88%, lower than 2.85% in rural areas.

The number of employed people aged 15 and above reached 50.3 million from January-June, up 417,000 from a year earlier. The figure included 18.6 million in urban areas, up 762,000.

Workers’ average monthly income grows 5.3% in H1

Workers’ average monthly income stood at 6.5 million VND (278 USD) in the first half of this year, respectively rising 5.3% and 11% from the same period of 2021 and 2020, statistics showed.

In particular, workers in the processing – manufacturing industry had average income of 7.3 million VND, rising by some 476,000 VND year on year, while salary earners saw an increase of 417,000 VND in their monthly income to 7.4 million VND, Pham Hoai Nam, Director of the Population and Labour Statistics Department under the General Statistics Office, told a press meeting in Hanoi on July 6.

In the second quarter, all the 21 economic sectors recorded year-on-year hikes in workers’ average income, including mining (9.7 million VND, up 17.1%) and processing – manufacturing (7.4 million VND, up 12.4%).

However, the situation was different this year, when the Q2 average income did not decrease but went up both quarter on quarter and year on year.

It rose by 8.9 percent (about 542,000 VND) from the same period of 2021 – when the COVID-19 situation was getting complicated in many localities, and by 19.7 percent (nearly 1.1 million VND) from Q2 of 2020.

Coffee exports surge by nearly 50% in first half

Vietnam exported 1.03 million tonnes of coffee worth over US$2 billion during the first half of the year, representing a year-on-year rise of 21.7% in volume and 49.7% in value, according to the General Department of Vietnam Customs.

June alone witnessed the country ship 145,000 tonnes of coffee worth US$335 million,  marking a rise of 13.3% in volume and 34.7% in value compared to the figures recorded in June of last year.

The average export price of local coffee stood at an estimated US$2,309 per tonne, up 1.3% compared to May and 18.9% higher than June, 2021, thereby bringing the six-month export price to US$2,258 per tonne, up 23.1% annually. Furthermore, global coffee prices dropped in late June compared to the end of May as a result of pressure from tight monetary policies and an abundance of supply sources. In contrast, the domestic price of Robusta coffee in late June increased sharply in comparison to the end of May.

Vietnam, Canada hold first session of the Joint Economic Committee

Deputy Minister of Industry and Trade Do Thang Hai joined with Canada’s Deputy Minister of International Trade David Morrison to co-chair the first meeting of the Joint Economic Committee (JEC) between the nation and Canada, in Vancouver, British Columbia, Canada, on July 6.

The primary purpose of the meeting is to deepen the comprehensive partnership that exists between both sides, with the move expected to contribute to taking the bilateral economic relationship to new heights.

Deputy Minister Hai noted that the meeting is part of the combined efforts to celebrate the fifth anniversary of the Comprehensive Partnership which began in 2017 ahead of the 50th anniversary of their diplomatic ties which started back in 1973.

Sharing this view, Canadian Deputy Minister Morrison assessed that the first meeting opened a new chapter in terms of bilateral economic co-operation.

Immediately before the first session, an exchange was held between Deputy Minister Hai and Canadian Minister of International Trade, Export Promotion, Small Business and Economic Development Mary Ng.

Vietnam-Korea industrial businesses seek cooperation
     
Seventeen Korean basic industrial manufacturing enterprises (PPURI Industry) and 30 Vietnamese importers have connected online to seek business opportunities during the Viet Nam-Korea Industrial Business Trade Week on July 4-8.

About 60 working sessions were held during the event organised by the Korea Trade and Investment Promotion Agency (KOTRA).

Products introduced by Korean enterprises include machines, machine tools and accessories, industrial robots, industrial cleaning machines, building materials, chemistry, automotive parts, parts for armoured vehicles, and supplies for railways and shipbuilding industries. These high-quality products have been widely used in Korea and exported worldwide.

Businesses of the two countries discussed product specifications, export prices, delivery time, sample-making and payment methods. Several import orders are being put on the table.

Textile producers prepared for barrage of disruption

Vietnamese enterprises are trading well so far this year, but key exporters in textiles, garments, leather, and footwear are still suffering from increasing raw material costs.

In the first six months of 2022, the total import and export turnover of goods reached $371.17 billion, up 16.4 per cent over the same period last year, of which exports increased by 17.3 per cent on-year; imports rose by 15.5 per cent on-year. The balance of trade in goods in the first six months of the year was estimated to have a trade surplus of $710 million according to the General Statistics Office of Vietnam.

Vietnam’s exports of these products reached an all-time high of $22 billion in the first six months of 2022, up 23 per cent on-year, but SSI Research said that the average price of imported yarn increased by 10 per cent year-on-year due to higher cotton and oil prices, along with high anchoring logistics costs.

According to domestic garment manufacturers, customers have shortened the time to take orders due to high inventory levels in the export market and inflationary pressures. Previously, customers usually ordered six months in advance, now they only order three months in advance.

Therefore, it is estimated that the revenue growth of textile and garment manufacturing companies in Vietnam will decelerate in the next six months. Besides that, rising oil prices and competition in the labour market is negatively impacting the entire textile supply chain, from manufacturer to retailer.

VNPT and T&T Group sign cooperation agreement

Vietnam Posts and Telecommunications Group (VNPT) and T&T Group on July 4 signed a comprehensive strategic cooperation agreement for the 2022-2026 period.

The cooperation will focus on banking, finance, and insurance; real estate and infrastructure; trade; health, education, and sports; and others.

Specifically, T&T Group with its diverse ecosystem will provide VNPT with high-quality products and services from its member companies.

Meanwhile, VNPT will provide T&T Group’s ecosystem with solutions, products, and services in telecommunications, IT, and digital transformation and content with optimal quality.

Vietnam Railways sees recovery in first half of 2022

Vietnam’s railway industry saw growth in revenue and cargo transport in the first half of 2022, heralding a recovery ahead.

The state-owned railway giant Vietnam Railways (VNR) on July 4 held a meeting to review the first-half performance and set tasks for the second half.

Accordingly, VNR’s consolidated revenue was estimated at about $143.47 million, up 5.2 per cent on-year. The parent company VNR alone made revenue of over$42.95 million, a rise of 22.5 per cent from the same period last year. Despite the increase, revenue growth remains lower than in the same period of 2019.

At present, the railway industry is also facing difficulties due to rising fuel costs. To fulfil the 2022 targets, VNR aims to make revenue of over $167.82 million in the second half, up 5.4 per cent on-year.

The industry will continue to boost passenger and cargo transport, focusing on traditional items of huge volume like fertilisers, coal, rice, salt, and others. It will also boost international freight trains to meet demands.

VNR and its units have faced some major losses over the past two years. In 2021, VNR reported a loss of around $30 million.

Edtech platform Azota secures $2.4 million led by GGV Capital

EdTech platform Azota, which allows teachers to create and grade online tests efficiently, has just raised $2.4 million in a Pre-Series A round led by GGV Capital. Other backers include Nextrans and existing investor Do Ventures.

Azota is the only local edtech product endorsed by the Ministry of Education and Training for the 2021 national online teaching training programme.

Azota offers teachers automated test creation and assessment solutions, exam proctoring tools, and real-time student performance tracking. All test results are stored and analysed on the Azota system, making management much more convenient for teachers and schools.

The one-year-old startup counts more than 700,000 teachers and 10 million students as its users. During peak periods, the company served over six million users monthly, equaling 30 per cent of the total number of teachers and students nationwide. About 300 million exercises have been submitted through Azota’s system.

Vinpearl Landmark 81 no longer affiliate of Vinhomes

Vinhomes JSC (VHM) has announced it has transferred its entire stake in Vinpearl Landmark 81 JSC to Vinpearl JSC, meaning that Vinhomes is no longer the stakeholder and parent company of Vinpearl Landmark 81.

Vinpearl Landmark 81 and Vincom Retail Landmark 81 JSC were established by Vinhomes in February this year. Of the Vinpearl Landmark 81 company’s charter capital exceeding VND1.605 trillion, Vinhomes contributed over VND1.603 trillion, or a 99.88% stake. As for Vincom Retail Landmark 81, its charter capital is over VND1.228 trillion, with VND1.226 trillion contributed by Vinhomes, or a 99.81% stake. These two subsidiaries of Vinhomes are headquartered at the Vincom Center Dong Khoi in HCMC’s District 1.

Vinpearl Company, a tourism and hospitality subsidiary of the local conglomerate Vingroup, agreed last February to transfer the management rights of its 12 hotels and resorts to the Meliá Hotels International hotel chain for a minimum duration of 10 years.

Under this deal, the 12 Vinpearl hotels and resorts will be renamed Meliá Vinpearl. Vinpearl said that the cooperation with Meliá is part of its strategy to elevate and internationalize the Vinpearl brand in the hospitality industry.

Lower fees, charges proposed for transport operators

The Ministry of Transport has written to the Ministry of Finance proposing reducing fees and charges on traffic infrastructure until the end of 2022 amid the rising fuel prices.

The proposal was made today, July 6, to help reduce transport costs fueled by the high prices of gasoline and other fuels, the local media reported.

The ministry proposed a 30% cut on charges for passenger coaches and a 10% reduction on the charges for goods transport vehicles until the end of 2022.

As for maritime transport, a 20% reduction on vessel tonnage fees, maritime insurance costs and seaport entry and exit fees was also proposed for local ships from August to the end of the year.

The ministry also sought to lower certificate assessment fees in the aviation field and secured transport registration fees for aircraft by 20% each. Regarding railway transport, the ministry proposed extending the 50% cut on railway infrastructure use fees until late 2022.

Two Thu Thiem land auction winners yet to pay land use fees

Dream Republic Corporation and Sheen Mega JSC, which are among four businesses that won land auctions in the Thu Thiem New Urban Area in HCMC in late 2021, have yet to pay land use fees even though the July 6 deadline has passed.

Under the regulations, the first payment must be made 90 days after the fee announcement, but they failed to do it. As such, the city tax agency took coercive measures by having their bank accounts frozen to enforce the land use fee payments but ironically, their bank accounts have no balance.

Earlier in April, the two firms proposed paying the land use fees by monthly installment, from April to September, but their proposal was not approved. They later said they would pay VND100 billion by April 30 as a goodwill gesture and pledged to complete the payment within 180 days, but the tax department still had no official update about this.

Dream Republic Corporation, which won the auction for a 6,400-square-meter lot in late 2021, must pay a land use fee of VND3.82 trillion and a registration fee of VND500 million for this lot. Meanwhile, Sheen Mega JSC, which won the auction for an 8,600-square-meter land lot, is subject to a land use fee of VND4 trillion, but exempt from the registration fee.

As the payment deadline has passed, their total deposits worth over VND319 billion will be seized and submitted to the State budget. Meanwhile, the land lots will be auctioned again or handed over to those who win.

Two other firms that won the auctions of the Thu Thiem land lots are the Viet Star Real Estate Investment Co., Ltd, a subsidiary of Tan Hoang Minh Group, and the Binh Minh Trading and Development Investment Co., Ltd. However, they later canceled their deals and lost the deposits amounting to hundreds of billions of Vietnam dong.

HCMC to hold tourism business matching forum

A tourism business matching forum is set to kick off in HCMC on August 8, making it the first-of-its-kind to be organized in the city.

The two-day forum is aimed at connecting local travel firms and promoting their cooperation to develop the tourism sector after Covid-19, the local media reported.

This is the first time the city will organize such a large-scale tourism networking forum, Nguyen Thi Khanh, chairwoman of the HCMC Tourism Association (HTA), told a conference held by HTA on July 5.

The forum, with the participation of representatives from HTA, the tourism agencies of many countries, local and international tour operators and provincial and municipal governments, is set to feature over 100 booths introducing tourism services and products nationwide.

VND24t needed to upgrade Cam Ranh airport by 2030: CAAV

The upgrade of the Cam Ranh International Airport in Khanh Hoa Province will cost an estimated VND24.3 trillion during the 2021-2030 period and an additional VND15 trillion between 2030 and 2050, according to the national aviation authority.

The Civil Aviation Authority of Vietnam (CAAV) sent the Ministry of Transport a revised zoning plan of the airport for the 2021-2030 period, with a vision toward 2050, as passenger traffic through the airport in recent years has exceeded the forecasts in a previous zoning plan.

Under the revised plan, the airport would serve 25 million passengers and 55,000 tons of commodities annually in the 2021-2030 period.

CAAV proposed building terminal T1 with an annual capacity of 21 million passengers and keeping the capacity of international terminal T2 unchanged at four million passengers per year. The cargo terminal would be rebuilt east of the apron.

By 2050, the airport would be able to handle 36 million passengers and 100,000 tons of cargo a year. In addition, the airport will renovate terminal T2 and build domestic terminal T3 with a yearly capacity of 12 million passengers. The cargo terminal will also be expanded eastward.

ADB, UK help catalyze green financing in Southeast Asia

The Asian Development Bank (ADB) and the Government of the United Kingdom (UK) have signed a memorandum of understanding to develop a £107 million (around US$134 million) trust fund to support efforts by Association of Southeast Asian Nations (ASEAN) countries to scale up green financing and shift to low-emission, climate-resilient development.

The UK–ASEAN Catalytic Green Finance Facility (ACGF) Trust Fund will leverage UK and ADB funds to accelerate a pipeline of low-carbon and climate-resilient infrastructure projects and catalyze financing from public and private capital sources. The fund will be part of the ASEAN Green Recovery Platform launched at COP26.

The fund will leverage financial resources for the ACGF, an ADB-managed regional green financing vehicle, owned by the ASEAN countries and ADB. Since its launch in 2019, the ACGF has attracted US$2 billion in cofinancing pledges and included five projects in its formal financing pipeline. It has helped develop a longer pipeline of 29 green infrastructure projects and provided advisory support that has enabled countries to tap capital markets through the issuance of more than US$5.6 billion in green bonds. 

The UK–ACGF Trust Fund will build on these efforts and support countries through loans and technical assistance to mobilize capital, including through regional initiatives such as the Blue SEA (Southeast Asia) Finance Hub, based in Indonesia.

Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes