Hanoi Gift Show 2018 to draw more than 250 exhibitors
Local airlines increase aircraft fleet
Data from the Civil Aviation Administration of Vietnam (CAAV) show that the number of aircraft registered in Vietnam amounted to 175 as of September, up 14% year-on-year.
Cat Lai customs work with 58 shipping firms over waste imports
Customs officials at HCMC’s Cat Lai Port have worked with representatives of 58 shipping companies that have transported over 3,000 containers of scrap to the port to determine their responsibilities and brief them of the Prime Minister’s Directive 27 on solutions to enhance control over imported waste, Thanh Nien newspaper reported, citing Pham Thi Leo, deputy head of Saigon Port Area 1 Customs Office.
Leo said the customs agency was cooperating with these shipping companies in line with the 2014 Customs Law and 2005 Maritime Law.
Shipping companies were asked to carry ineligible scrap imports out of Vietnam. They must assume responsibility for the waste containers until these containers find their owners.
However, most of the representatives of shipping companies attending the meeting with customs officials were unable to make decisions to resolve the problems and had to contact their superiors for direction.
According to the shipping companies, it is impossible to transport containers of secondhand products to other countries. In response, the customs office requested them to pay all costs for destroying illegal waste imports.
According to the Saigon Port Area 1 Customs Office, as of October 2, some 4,000 containers storing scrap were abandoned at Cat Lai Port, including more than 3,000 containers that had been left at the port for more than three months.
Leo noted that the competent agencies were classifying waste containers for destruction, re-export or auction in accordance with Circular 203/2014 on the handling of backlogged goods.
At the monthly Cabinet meeting on October 1, Minister of Natural Resources and Environment Tran Hong Ha stated that some 5,000 containers of waste have piled up at local ports. Up to 158 organizations and individuals are importing scrap without the required certificates.
The ministry will help individuals and enterprises that import waste as production materials to promptly complete customs clearance procedures. Besides this, derelict containers storing scrap that is harmful to the environment will be processed at hazardous waste treatment facilities, while waste that can be recycled will be auctioned.
The Ministry of Finance has worked with the General Department of Vietnam Customs and customs offices at ports with imported scrap backlogs to discuss solutions to handle the large volume of containers of waste found at seaports.
Under the Government’s Directive 27/2018 on solutions to enhance the management of the import and use of waste as production materials, customs clearance procedures will not be completed for ineligible waste shipments. Shipping companies must provide sufficient information on the importers of waste and the certificates for environmental protection in scrap imports as production materials before docking at local ports.
In addition, the Ministry of Natural Resources and Environment will team up with the Ministries of Finance, Industry and Trade, Science and Technology, Foreign Affairs, Public Security and National Defense as well as localities to review the compliance with the law among enterprises that had been granted licenses for importing waste and to check waste containers at ports, and report the results to the Government in the next quarter.
Ecommerce revenue reaches US$6.2 billion in 2017
Vietnam saw the ecommerce sector grow by a whopping 24% to US$6.2 billion in revenue in 2017, according to the Vietnam Ecommerce White Book 2018 launched by the Ecommerce and Digital Economy Agency in late September.
The Vietnamese ecommerce sector recorded the strongest growth at 37% in 2015.
The number of shopping transactions online reached an estimated 33.6 million in 2017, up some 1.1 million against the 32.7 million transactions recorded in 2016. Customers in 2017 spent US$186 on each online purchase, rising US$16 from the US$170 spent in 2016.
Data from the Ecommerce and Digital Economy Agency show that business-to-consumer online transactions accounted for 3.6% of the total retail sales of goods in 2017, edging up 0.6% against 2016.
Revenue from online goods retail has been on the rise in recent years as customers become more used to shopping online, according to the Vietnam Ecommerce Association.
Regarding payment methods, 82% of customers opted to pay cash on delivery of the goods, 48% made payments through bank transfers, 19% paid with international payment cards and 7% used ewallets.
The White Book also showed the most popular way of shopping goods and services online. In particular, a package of 15 goods or services accounted for 19% of purchases, while packages of 10 to 15 goods or services represented 13%. Packages with five to nine items and those with less than five items made up 38% and 30%, respectively.
Vietnam currently has over 50 million internet users, making up 54% of the country’s population and surpassing the world’s average of 46.64%, according to the agency. The country is considered a potential market for developing the ecommerce sector.
Revenue from the online retail sector in Vietnam rocketed from US$2.2 billion in 2013 to US$6.2 billion in 2017. The country has witnessed diversity in ecommerce operations and transactions, not only on computers but also on smartphones and tablets.
Q3 home sales decline
HCMC apartment sales dropped in the third quarter by 7% versus the previous quarter and by 16% against the same period a year earlier, with just over 6,500 units sold, a housing market report from CBRE Vietnam indicated.
Local media cited the report in pointing out that the number of apartments offered for sale in HCMC was 6,711, most of which belonged to small-scale projects.
The consumption decline was attributed to customers’ and investors’ tendency to avoid making transactions in the seventh lunar month, often seen as a month of bad luck among superstitious people.
However, although the supply and market absorption have declined, apartment prices in HCMC have still picked up. The average apartment price on the secondary market in the third quarter was recorded at US$1,607 per square meter, up 2% against the previous quarter and 10% against last year’s third quarter.
Rising selling prices were noticed for medium- and high-end projects in prime locations. HCMC’s eastern section, such as districts 2, 9 and Thu Duc, has seen a price rise of 5%-7% quarter-on-quarter.
According to CBRE, market liquidity is projected to bounce back this quarter thanks to plentiful offers at year-end in the context of demand from local and foreign customers remaining high toward the end of the year. The eastern and southern parts of the city will remain hot spots for the market in the final quarter.
Major mid-end projects such as Vincity Grand Park and Safira in District 9 and Akari City in Binh Tan District will be offered on the market in the final months of the year.
The high-end housing segment, with prices exceeding US$7,000 per square meter, is drawing significant attention and is likely to emerge late this year. The offering of many products priced at VND160 million per square meter may push up apartment prices considerably in the city in the coming period.
Based on this, experts believe the HCMC property market is showing signs of a bubble and that it may be facing a crisis as the 10-year crisis cycle can be repeated.
According to a report from Savills Vietnam released earlier this month, many people are still concerned about the risk of a property bubble.
Su Ngoc Khuong, director of investment at Savills Vietnam, said that as shown by data, the market size is still stable and will continue to develop in line with Vietnam’s growth.
According to Khuong, mostly Grade-C apartments were sold in previous quarters. The segment will make up 60% of the supply over the next three years, but the supply will continue to increase since population growth is forecast to be high, family sizes are shrinking, accommodation for singles is surging and personal savings are increasing. The supply and demand of this housing segment are balanced, experts agree.
Identity values under threat
The conflict between preservation and development has always been a constant one, but in HCMC, it is even more striking given the fast pace of development. The issue therefore steals the limelight when local authorities put forth for public comment a scheme to tear down an ancient building to allow for expanding the municipal administrative center.
As widely covered in local media, the municipal government has plans to develop a concentrated administration cluster that will encompass the current City Hall and adjacent areas to have sufficient working space for 1,700 civil servants of the city. Under a blueprint prepared by an international consultant, an ancient building aged more than 150 years on Ly Tu Trong Street – often called Thuong Tho Palace and being the seat of the city’s Department of Information and Communications – will be replaced by modern building facilities as part of the administration cluster project.
To achieve social consensus on the scheme, the city government in May posted the plans and maps on the project at the old building for public comments. The reactions are mixed, but experts and professionals voiced stiff objection to the scheme. As many as 3,000 intellectuals, many of them being architects and historians, have even signed a letter to the HCMC chairman, urging the authorities to keep the French-built palace intact.
Upon such protests, the city’s Department of Zoning and Architecture, at the order of HCMC Vice Chairman Tran Vinh Tuyen, hosted a seminar here last week to gather opinions from professionals on the issue. Voices to protect the building were so overwhelming and will likely prompt the municipal government to rethink the plan.
As stated by professionals at the seminar, the ancient building is among the oldest in the city, dating back to the 1860s when the French first set foot in the country. Thuong Tho Palace had existed before other landmarks in the city like the Notre Dame Cathedral, the Municipal Theater, or the HCMC Post Office, according to experts at the seminar.
In 1860, works started on Thuong Tho Palace and Xa Tay Palace, the latter being the current City Hall. And in 1864, the French Governor of the South decided to establish the Department of Interior headquartered at Thuong Tho Palace, and the acronym DI engraved on the gate of the building is still found today, Tran Huu Phuc Tien, a history researcher, said at the seminar.
“The foundations of these two buildings contain vestiges of not only Gia Dinh Citadel but also Tan Khai Village, which used to be the cradle of the Vietnamese people when first setting foot in Saigon,” Tien is quoted by vov.vn as saying at the seminar.
Ngo Viet Nam Son, a well-known architect, rang a bell of alarm at the seminar, saying the city’s management over heritage sites is inadequate, leading to a gradual loss of many valuable heritage structures, according to the Vietnam News Agency.
Architect Tran Van Khai from the HCMC University of Architecture stresses that “demolition of urban architectural heritage sites is suicidal in terms of culture, since preservation of such heritage sites will add momentum to the socio-economic growth,” according to vov.vn, which is the website of the Voice of Vietnam. Similarly, Tran Ngoc Chinh, chairman of the Vietnam Urban Planning and Development Association, says in the news site that Thuong Tho Palace boasts apparent cultural, historical and architectural values and is closely associated with the development process of the city.
In Nguoi Lao Dong, history researcher Nguyen Thi Hau says it is obvious that development will lead to changes, but changes that cause urban symbols like Thuong Tho Palace to disappear indicate that the development is not sustainable.
In fact, the city government has been cautious over the plan from the beginning, but no State agencies in the city have opposed the project. In the past, the city government has suggested preservation for the building as it could be a historical site, but no agencies have confirmed this status, says the city government’s chief of staff Vo Van Hoan in Vnexpress.
The crucial point is that the building is not listed as a cultural or historical heritage site in the city, and thus not protected under the law. It is this point that aroused grave concerns at the seminar.
Ngo Viet Nam Son says in Nguoi Lao Dong that apart from Thuong Tho Palace, the city government should have solutions to protect structures that have not been included in the list of heritage sites, and it will be a big regret if protection is given to only those sites included in the list. “Many heritage sites in the city have not been formally recognized, such as the Notre Dame Cathedral, the Municipal Theater, the HCMC Post Office, Ben Thanh Market, and Grand and Majestic hotels, bust such sites in reality are major symbols of the city to the residents and visitors,” the architect is quoted as saying.
The online media The Leader says heritage sites are precious gifts from the past for today’s urban economy, and many urban centers around the world have benefited greatly from their heritage sites. Exploring another dimension of the conflict between preservation and development, the media outlet argues that the conflict emerges due to wrong perceptions. “Either the point that preservation must be against development, or that development requires demolition of the old is wrong. In fact, preservation and development are not necessarily on the collision course,” says the news site. It also points to examples of Dalat and Hoi An, saying while the former with more modern development is losing appeal to tourists, the latter is thriving owing to better preservation.
However, positive changes are expected after the above-mentioned seminar.
According to Vietnam News Agency, the city government has directed the Department of Zoning and Architecture to enlist Thuong Tho Palace as an architectural site considered for preservation. However, greater efforts are needed to protect not only Thuong Tho Palace, but also many other sites that are deemed to hold the identity values of the city, otherwise they will be replaced by modern buildings due to the fast development of the city.
Nguyen Minh Hoa, a researcher on urbanization, says in The Leader that despite numerous French-built structures that are very beautiful in the city, such sites account for only 5% of recognized sites in the city. “Several Catholic churches that are considered architectural masterpieces, such as Notre Dame Cathedral, are not recognized in the list of heritage sites,” Hoa says in The Leader.
The development without a proper scheme to protect heritage sites will push the city’s identity values to the oblivion, says Architect Ngo Viet Nam Son in Vietnam News Agency, adding it is imperative for the city to have a fully-fledged scheme with legal validity to protect such sites.
Steel industry faces increasing trade defense measures
So far seventeen nations and territories have started investigation over 128 trade defense cases against Vietnam’s export goods, 85 percent of these are related to steel industry.
A total of 11 markets have filed lawsuits against Vietnamese steel namely the US, the EU and the Eurasian Economic Union (EAEU) while Malaysia, Turkey and Taiwan (China) are considering to do so.
The capacity redundancy of the world steel industry has strongly impacted steel production of many countries including Vietnam.
According to Organization for Economic Co-operation and Development (OECD), steel output in the world has gone double from 2000 to 2016 reaching 2.39 billion tons.
Production capacity has outstripped demand by 700 million tons in 2015 and 800 million tons in the following year. China’s production increase has been blamed for the surplus. Specifically, the country produced 488 million tons in 2006 and 1.6 billion tons in 2016.
Many countries have applied many measures to tackle the issue. As of April this year, the United States Department of Commerce has launched 437 anti-dumping duty investigations and orders including 225 orders concerning to steel including Vietnamese products, according to deputy minister of Industry and Trade Tran Quoc Khanh.
The European Community (EC) has applied defense measures against import steel products to prevent them from shifting from the US to nations in the union.
Vietnamese businesses have focused on improving their production process and competitive ability to deal with the increasingly trade defense.
Bao Viet Holdings shares reporting experience
IREX Energy enters US
The IREX Energy JSC, a member of Vietnam’s SolarBK Holdings, last week attended SPI (Solar Power International) as the only Vietnamese company, joining several world-class equipment and technology companies.
SPI is the biggest solar energy exhibition in North America and took place at Anaheim City, California. This was the 15th holding and the second consecutive year IREX has attended the three-day exhibition. Attended by more than 20,000 experts in the energy industry and visitors from more than 80 countries, it was a valuable opportunity for IREX to gain experience in the global market by learning from competitors about how to connect customers and expand its markets.
IREX has also worked hard on its “internationalization” strategy this year, with the goal of becoming the first company in Vietnam to achieve Tier 1. To make it through, IREX established many branches and offices in countries such as the Dominican Republic, the UK, the US, Myanmar, China, and elsewhere. It also attends other many renewable energy exhibitions around the world.
Along with these efforts, IREX is also striving to reach the goal of exporting 160 MW this year, receiving at least three orders of a minimum of 1.5 MW, to be guaranteed by domestic banks in light of facilitating its Tier 1 criteria in 2020.
The US has been one of the markets of most potential for rooftop solar power solutions since April, with 67.2 million (57 per cent) of 116.9 million American households falling into the middle-income range and suitable for solar panel installation.
In August, California proposed and is waiting for approval of a 100 per cent renewable energy plan (especially solar and wind energy) to 2045, to gradually resolve its climate change issue. California is the second state, following Hawaii, to make use of carbon-free electricity, while Massachusetts and New Jersey are expected to follow.
Figures for the first half of 2018 show that solar energy production constituted more than 10 per cent in five major US states: Massachusetts, California, Hawaii, Nevada, and Vermont. Meanwhile, solar energy accounts for 2.4 per cent of total power production domestically (48 TWh).
President Donald Trump decided to impose tariffs of 20 to 30 per cent on imported solar panels six months ago, which left many US companies in the solar energy industry with a dilemma. However, the US’s solar market is still developing. 2.5 GW of total capacity was installed in the first quarter of 2018, up 13 per cent over last year.
Thus, in terms of growth and market size, the US still has the most potential for IREX, especially since it already has a branch in the country and understands the local market. Regarding the challenges posed by tariff policy, IREX assumes that upcoming developments may be different because domestic companies have also been negatively impacted by the policy. Despite waiting for change, IREX has decided to stake out a presence in the US and seek opportunities, while other competitors, especially those from China, are losing their position.
Foreign markets tighten control on origin traceability
Foreign arrivals to HCM City pass the 5 million mark over 9-month span
The number of foreign tourists arriving in Ho Chi Minh City during the first nine months of 2019 was estimated at 5.45 million, up 21.25% from the same period the previous year and already reaching 72.6% of this year’s target for foreign tourists.
Total income received from tourism during the first nine months of 2018 reached around VND98,494 billion, a rise of 18.19% from 2017. Enjoying a growth rate of 9%, the tourism sector only lags marginally behind the trade sector for highest growth this year at 9.1%.
Over the past nine months, the city has organized a range of high quality events specifically aimed at tourists such as an Ao Dai festival, a tourism festival, a ceremony to welcome the first visitor of the year, a southern food festival and a southern fruit festival. With the quality of events increasing and also diversifying, coupled with more efficient promotion to spread the word, festivals and events in HCM City have seen both domestic and foreign visitors flock to them
In addition to these events and festivals, the city has accelerated its promotion of tourist activities such as the waterway tourism programs, agri-eco tourism, a “HCM City – 100 interesting things” program, art performances and a HCM City tourism festival. Furthermore, it has focused on implementing measures to ensure security and safety for visitors and improve the tourism environment so as to build an image of a friendly, attractive and safe city.
ESMO factory granted investment certificate
ESMO (formerly NEXEN TECH) has just received the investment certificate for the project of electrical cable factory worth $26.5 million in the northern province of Ninh Binh.
In the morning today, Chairman of the Ninh Binh People’s Committee Dinh Van Dien has handed over the investment certificate to the project of ESMO’s electrical cable factory worth $26.5 million in Ninh Binh.
Previously, ESMO (formerly NEXEN TECH) has just started construction of ESMO VINA – its first wiring harness factory in Vietnam. Covering an area of 63,500m 2 with total investment of VND700 billion, this facility (located in Gia Phu Industrial Zone – Ninh Binh) is expected to create about 2,000 jobs for local people.
The ceremony was attended by Kim Do Hyun, South Korean Ambassador to Vietnam, Kim Cheong Hoon, general director of ESMO Korea, and Lee Jong Wook, general director of Global Land (ESMO) in Vietnam.
The ESMO VINA facility is established to improve production capacity to meet new orders, while enhancing its competitiveness through the systematic production of specialised parts for hybrid and electric vehicles. Its key product line is wiring harness—the company’s flagship product with a production volume of about 450,000 products per year—used in large and small buses as well as battery module harness (battery module system), and electric vehicle charger cable, with a view to the explosion of hybrid electric vehicles from 2020.
In the context of international agreements on emissions reduction that are being implemented to fight against climate change and the greenhouse effect, reducing emissions from vehicles is also one of the important tasks for automobile manufacturing enterprises. Electric vehicles and hybrid vehicles are becoming more and more popular, leading to the development of the parts industry that ESMO pioneers.
Based on the long manufacturing experience as well as a team of high-quality local and international engineers, ESMO Group is expected to contribute to promote economic growth for Ninh Binh and Vietnam. At the same time, it is expected to create about 2,000 jobs for local people which will not only help upskill the local labor force, but also enhance regional competitiveness.
ESMO currently operates two manufacturing facilities (GoHyeon and RaeSeo) in Qingdao (China). In order to realise the goal of expanding business to Southeast Asia, ESMO has just established Global Land Vina Co., Ltd. in Vietnam in addition to building this third facility. The company also plans to increase its product volume for the rapidly growing automakers concentrated in Southeast Asia.
Early this March, NEXEN TECH (now ESMO) has partnered up with UK business Volex which is expanding its business network with wiring harness, including the exclusive supply of Tesla Model 3 rechargeable cables (used in electric vehicles developed by Tesla Motors or equipment of Dyson UK) which is expected to be launched by the end of this year.
NEXEN TECH has been renamed to ESMO earlier this May.
Awareness of corporate culture lacking
Sixty-three per cent of respondents in discussions at the 4.0 Industrial Revolution Corporate Culture Forum in Hanoi on October 3 said they recognized a key factor behind unsuccessful corporate culture models as being a lack of deep awareness about corporate culture and its role in the enterprise.
The forum was held by the Vietnam Chamber of Commerce and Industry (VCCI), the Hanoi Association of Women Entrepreneurs (HNEW), and Deloitte Vietnam, with 200 people in attendance, including local experts and enterprises and associations.
In the survey, 21 per cent of respondents said the key factor is a lack of a clear vision about corporate culture; 21 per cent said a lack of tools and methods to build a corporate culture; and 12 per cent a lack of patience and effort in the process of building a corporate culture. Dr. Vo Tri Thanh, a local expert, said that awareness is the key reason for this and, as the technology era develops, people are the biggest influencers in building a successful corporate culture.
“Small and medium-sized enterprises can seize the opportunities from Industry 4.0 if they are aware that corporate culture is a core value in the enterprise’s competitive capacity and helps them develop sustainably in this era,” said Ms. Ha Thu Thanh, Chairwoman at Deloiite Vietnam.
Dr. Vu Tien Loc, Chairman of VCCI, said an enterprise’s sustainable development depends not only on investing in technology but also on corporate culture. “Building a corporate culture 4.0 will help harmonize and create good interaction between people and robots at work and utilize the opportunities from Industry 4.0,” he said.
Mr. Gian Tu Trung, President of the IRED Institute of Education in Vietnam and Director of the PACE Institute of Leadership and Management (PACE) said that an industrial revolution not being accompanied by a cultural revolution would be a disaster, as the digital era is fluctuating and difficult to conceive, so everything must be redefined. “A successful enterprise is one spending 80 per cent of the time on building a corporate culture and 20 per cent on building its business strategy,” he said. “Meanwhile, most Vietnamese enterprises are doing the opposite.”
Mr. Le Phung Thang, CEO of Citicom Commercial JSC agreed with Mr. Trung about basic cultures at a company, and added that adaptive culture is also important for each employee and leader in Industry 4.0. The Hien Le Trading and Service Co., Ltd, an electric component supplier of Canon and Apple, is a typical case. Ms. Nguyen Thi Bao Hien, Chairwoman and CEO, said they have always been a pioneer in modern technology to ensure international-standard products meet the requirements of major multinational corporations. “This requires myself and all my employees adjust and adapt to constant changes,” she said.
Dragon fruit farmers in Binh Thuan suffer huge losses
Due to prolonged rainy weather, thousands of hectare of dragon fruit land in the central province of Binh Thuan got disease driving farmers into despairs.
At present, price of a good dragon fruit is VND3,000-5,000 a kilogram while normal kind fetches VND500-700 a kilogram. Farmers said this price is lowest during two recent years.
Nobody buys diseased fruit; consequently, farmers used fruit as animal feeding.
Looking at over 3,000 plants with ripen dragon fruits, farmer Nguyen Thi An in Ham Lien Commune in Ham Thuan Bac District said that she had been on the run all day to beg traders to buy the fruit but all traders turned down my proposal; accordingly, ten tons of my family’s fruits must be thrown away.
Likewise, farmer Nguyen Xuan Hoan in Ham My Commune is laughing out of the other side of your mouth because no trader proposed buying his nearly 2,000 dragon fruits.
Farmers had to cut off ripen fruits in the biggest dragon fruit lands in communes Ham Thuan Bac, Ham Thuan Nam, Ham Tan for preparation of next crop.
Some traders explained that last time, they bought the fruit at high price of VND20,000-23,000 a kilogram but low consumption leads to high inventories.
Currently, farmers are growing dragon fruits on over 27,000 hectares in Binh Thuan Province; most of them are exported to China in small amount.
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