SCIC to sell all shares of Cienco 5
The State Capital Investment Corporation (SCIC) plans to divest from Civil Engineering Construction Corporation No 5 (Cienco 5) on March 20.
According to the Ha Noi Stock Exchange, SCIC will sell its entire 40 per cent stake in Cienco 5 – as many as 17.56 million shares – at an initial price of no less than VND19,300 (US$0.8) per share. SCIC expects to collect more than VND339 billion for the shares.
As of October 2019, Cienco 5 has 84 shareholders including three major shareholders of SCIC, Hai Phat Investment and Hai Phat Capital Investment.
Established in 1995 on the basis of organisational restructuring in the transportation industry, the firm went public in 2004 with its initial public offering (IPO). At that time, Cienco 5 could only offload 1.9 million shares in the total registered 14.2 million shares offered at VND10,025 each.
Mainly working in local infrastructure, Cienco 5 has built big projects such as Thanh Ha new urban area, Cua Dai bridge, Ho Chi Minh road, Sai Gon-Trung Luong highway, Trans-Asia road, Cau Gie-Ninh Binh expressway and the Da Nang – Quang Ngai Highway.
However, compared to the working experience and big projects it has carried out, the firm’s business results have not been good at all. By the end of 2018, the firm’s yoy revenue decreased by 44 per cent to close at VND275 billion. It also lost 67 per cent in yoy profit after tax which closed at VND307 million.
Construction firms race to buy back stocks
Two construction and real estate companies have announced plans to repurchase their own stocks to stabilise prices.
Cuong Thuan IDICO Development Investment JSC (CTI) plans to buy back 30 per cent of its total shares listed on the stock market.
CTI will carry out a public tender with a fixed buying price of VND22,100 (US$0.95) per share. The company is expected to spend VND418 billion to buy a total of 18.9 million shares.
VRC Real Estate and Investment Joint Stock Company (VRC) will also purchase back up to 20 per cent of its shares.
The company has registered to buy a maximum of 10 million shares, equivalent to a value of VND75 billion. VRC hit its ceiling prices in the last four trading sessions.
Investment and Construction Development Joint Stock Corporation (DIG) has recently approved the plan to buy back 15 million shares.
Although the company only plans to buy a maximum of 4.78 per cent of the outstanding shares, it will cost VND203 billion.
If those three companies manage to complete their plans, the total amount of money they will pour into the market will reach approximately VND700 billion.
Last year, the stock market witnessed a series of stock repurchasing deals worth up to VND 13 trillion. Among them, real estate-retail-technology giant Vingroup and its arms Vinhomes and Vincom Retail spent more than VND7.5 trillion. Vietjet poured in VND2.35 trillion.
CTI has never repurchased stocks before. Over the past five years, the company’s capital has grown fast, from VND330 billion to VND630 billion.
Currently, CTI’s major shareholders are mainly investment funds such as Victory Holding Investment Limited, Kingsmeard Vietnam and Indochina Growth master fund and its Deputy General Director Truong Hong Loan.
The capital CTI will use to repurchase stocks often originates from equity capital, undistributed after-tax profits or from funds. The narrowing of the remaining profits may affect the dividend payout plan for 2019.
CTI’s cash balance is only VND83 billion, decreasing in 2019 because the company focused on disbursing construction investment.
At VRC, the cash balance is only VND14 billion. Real estate inventories account for the largest amount of CTI’s total assets, which value VND1.13 trillion, of which the two residential projects of Nhon Duc and Phuoc Loc-Nha Be total approximately VND869 billion.
However, liquidity of these project inventories remain doubtful as in the fourth quarter of 2019, the figure only rose by about VND2 billion.
Along with plans to buy back shares, VRC has submitted a request to shareholders to allow Happy Land Investment JSC to buy to increase the ownership ratio to over 25 per cent, without having to undergo a public bid.
If approved, the number of shares VRC is able to repurchase could be sold to the new shareholder.
F88 pawn chain to issue $2.15 million in bonds
This is the first issuance by F88 within the plan to raise VND200 billion through corporate bonds.
The bonds issued are non-convertible bonds with terms of 12 months and real interest rates of 12.5 per cent. Bondholders receive bond coupons every three months.
F88 said its plan to raise VND200 billion in corporate bonds was in consultation with MB Securities JSC and divided into three issuances. Bond buyers are mainly domestic investors.
The company said the proceeds from the issuances would be entirely spent on supplementing working capital, expanding the network of transaction offices, aiming to raise the number of transaction offices to 300 by 2020.
F88 started to thrive in 2017 after receiving capital from Mekong Capital and Granite Oak.
So far, the company has put into operation 145 transaction offices in 10 provinces and cities, an increase of more than three times compared to 2018.
In 2019, F88 reported accumulated disbursements of VND1.5 trillion and is expected to disburse nearly VND3 trillion in 2020, doubling compared to 2019.
Ninh Thuận to have new solar power plant inaugurated in June
A new solar power plant will come into operation in the south-central province of Ninh Thuận in middle of this year, following an engineering, procurement and construction (EPC) contract inked between Ninh Thuận Energy Industry JSC and Sharp-NSN joint venture on Monday.
The Phước Ninh solar power plant is expected to supply about 75 million kWh of electricity once operational, using solar panels and a 40MVA substation. Construction on the plant has been completed and it is ready for equipment to be installed so that it can open its doors in June.
Early in April 2019, the Ninh Thuận Energy Industry JSC – a member of T&T Group and the Electricity Power Trading Co (EVN EPTC) – an arm of Vietnam Electricity inked a power purchase deal for its solar power projects.
Under the deal, Ninh Thuận Energy Industry JSC will sell electricity to EVN EPTC with the price regulated in Prime Minister Nguyễn Xuân Phúc’s April 2017 Decision on mechanisms to encourage the development of solar power projects in Việt Nam.
For Ninh Thuận, the State has also offered incentives and preferential policies to ensure its socio-economic development in 2018-23, including to facilitate the development of solar power projects.
Ninh Thuận aims to become the renewable energy centre of the country. Blessed with abundant sunshine and wind year-round, the province is home to 25 solar power projects.
The province has a high level of sunshine hours (2,467) per year and solar radiation per square metre (1,700kWh), making it ideal for solar energy projects.
Under the province’s green energy plan, by 2030 it is expected to reach a total capacity of 1,500MW in wind energy and 3,912MW in solar energy.
State Audit played important role in PPP projects: experts
Experts discussed solutions to improve the quality and efficiency of auditing public-private partnerships (PPP) during a conference on Tuesday in Hà Nội.
“PPP projects and the role of the State Audit” was organised by the State Audit of Vietnam (SAV).
Speaking at the conference, Professor Đoàn Xuân Tiên, deputy general auditor of the SAV, said that capital from the private sector had contributed significantly to improving transport infrastructure and urban areas.
PPP projects helped ease the burden on the State budget, created a motion for socio-economic development and improved the economy’s competitiveness.
However, management still had many shortcomings, he said.
The selection process had failed to select qualified and experienced investors. Besides, investors’ capital contributions were often still late, but they were not held to account.
Deputy head of the Quảng Bình Province National Assembly delegation Nguyễn Ngọc Phương said one of the reasons leading to losses, waste and challenges on PPP projects was lack of inspections and auditing.
Most audited build-operate-transfer and build-transfer projects were implemented under the form of contractor appointment, which led to less competition and transparency in investor selection.
Offering solutions to these problems, former deputy chairman of the Economic and Budgetary Commission of the 11th National Assembly and also chairman of the Vietnam Accounting and Auditing Association Đặng Văn Thanh said the National Assembly should issue the Law on PPP soon.
In addition, the State should focus on researching and selecting potential projects.
It should strengthen supervision of projects on the principle of respecting the State’s and investors’ agreements.
To make PPP projects operate effectively, it was necessary to promote the role of auditing, he said.
Experts at the conference agreed that the State Audit played an important role. Both detecting flaws and loopholes in current law enforcement, and actively researching proposals to adjust, supplement and replace outdated regulations, would fill in the gaps related to PPP.
South Korean carriers cut Vietnam flights as coronavirus infections spiral
Largest carriers in the Republic of Korea (RoK) have decreased the frequency of flights to Vietnamese tourist hotspots over rising Covid-19 infections at home.
Korean Air, the largest airline in the RoK, has announced that it will suspend many flights departing from Seoul and Busan to Ho Chi Minh City and Hanoi, Vietnam’s two largest metropolises, Da Nang and Nha Trang in central region and Phu Quoc Island in the south until the end of March.
Asiana Airlines, the country’s second largest carrier, has also canceled many flights from Incheon Airport in Seoul to Hanoi, Da Nang and Nha Trang at least until mid-March. This airline’s Incheon-Phu Quoc route will continue operations, but the frequency will be reduced from four flights a week to two.
Korean Air normally operates 20 flights between the two countries a day, while Asiana Airlines has an average 4 flights a day. The two carriers did not reveal specific numbers of suspended flights.
The flight suspensions follow the rapid spread of the novel coronavirus in the RoK, where more than 4,800 infections and 23 deaths have been recorded.
The RoK is the second largest feeder market of Vietnam’s tourism after China, with around 4.2 million visitors in 2019, up 23.1 percent year-on-year.
Vietnam is a leading destination among South Koreans, ranked third after Japan and mainland China, according to Global Destination Cities Index (GDCI), released by Mastercard last year.
Nha Trang and Da Nang are among top holiday destinations for South Koreans.
The Covid-19 outbreak, with its epicenter in China, has severely cut the number of South Koreans traveling abroad, and Vietnam’s tourism sector has borne the brunt.
Around 322,000 South Koreans came to Vietnam in February, down 16 percent from a year ago. Worse still, the number is expected to decrease dramatically in the coming months after the South Korean government declared a red alert, its highest level of epidemic alarm.
The Vietnamese government, too, has deployed various measures to prevent the spread of the virus, including canceling many flights to the RoK and suspending visa-free entry for South Koreans starting February 29.
In Vietnam, national flag carrier Vietnam Airlines has said it will suspend all flights to the RoK from February 28 while private carrier Bamboo Airways halted services to the RoK from February 26.
Hanoi’s Noi Bai and Ho Chi Minh City’s Tan Son Nhat, Vietnam’s two largest airports, had stated they would stop receiving RoK arrivals.
Passengers scheduled to land in Noi Bai will have to do so at Van Don Airport in northern Quang Ninh Province, around four hours drive away, while those headed for Tan Son Nhat will have to travel a similar distance to Can Tho Airport in the Mekong Delta.
This decision was taken after a large number of Vietnamese returning from the RoK overloaded medical quarantine facilities in both cities.
All 16 people with Covid-19 recorded in Vietnam so far have been discharged from hospitals.
Globally, the death toll has reached 3,069, mostly in mainland China, followed by Iran (66), Italy (52) and the RoK (34). The US and Japan which have reported six deaths each.
India seeks greater supply chain co-operation with Vietnam
Despite the recent novel coronavirus (COVID-19) epidemic causing a significant impact on various global supply chains, both India and Vietnam are able to complement one another in multiple fields, especially in the textile and footwear sectors, said Indian Ambassador to Vietnam Pranay Verma at a recent press conference held in Hanoi.
Ambassador Verma believes that the COVID-19 epidemic has presented both challenges and opportunities for his country, with several Indian businesses that are involved in global production being affected by the sudden shortage of input materials.
He noted that India is able to supply Vietnamese enterprises with input materials, whilst the South Asian country is also keen to work alongside domestic enterprises to import products that India is lacking.
The Indian diplomat said the governments of both countries have therefore set a target of seeing trade turnover reach US$15 billion by 2020, adding that India is aiming to become an economy worth US$5,000 billion in the future which will offer plenty of opportunities for further co-operation.
He expressed his desire that local firms will be interested in the investment opportunities that exist in India’s priority areas, including the infrastructure sector.
Moreover, the South Asia nation is also keen on expanding markets and increasing investment activities in the country, particularly in fields that are considered to be India’s advantages, such as renewable energy, information technology, and pharmaceuticals.
According to Pranay Verma, his country currently has US$1 billion in credit package, specifically for enhancing connectivity, especially in the infrastructure and digital connectivity, noting that Vietnamese businesses have the chance of grasping this opportunity and taking advantage of the credit source.
Aside from improving overall product quality, local firms must also learn more about the practices, customs, and laws of India as a way of limiting the risks that come with exporting goods.
Local businesses losing out on array of online export opportunities
Limited human resources and a lack of foreign language skills are hampering domestic firms and causing them to miss out on numerous opportunities to strengthen global trade exchange and develop their own brands.
This information was released during a seminar discussing export promotion activities via the Amazon e-commerce channel in Hanoi on March 3.
During the discussion, Tran Xuan Thuy, Director of Amazon Global Selling Vietnam, said that the trend of online shopping has presented both an array of opportunities and challenges for individuals and businesses who are participating in the realm.
Thuy pointed out that global retail trade remains consistent and is growing strongly at a rate of 6 per cent with total retail sales reaching US$28 trillion whilst e-commerce sales account for approximately 13 per cent.
Despite this, the growth rate of e-commerce saw a six-fold increase in comparison with traditional sales activities, whilst cross-border e-commerce activities are becoming increasingly prevalent.
Due to this increasing trend, e-commerce sales are predicted to reach US$1,000 billion during the course of the year, which will serve to create opportunities to change the shopping habits of global consumers whilst presenting numerous chances for business expansion, Thuy noted.
Nguyen Thi Minh Thuy, Director of Information Technology and E-commerce Promotion Department under the MoIT, pointed out that the biggest challenge facing domestic firms and individuals, especially SMEs when joining e-commerce, is a limited pool of human resources coupled with a lack of foreign language skills.
These inadequacies have caused a number of businesses to miss out on opportunities regarding strengthening global trade exchange and developing their respective business brands, she added.
Thuy emphasised that firms still have limitations in terms of their financial potential, production capacity, the supply capacity of products, and management quality, especially a lack of foreign language ability as the nation engages in new-generation trade agreements.
As part of activities under the framework of a co-operation program between Amazon Global Selling Group and the Department of Trade Promotion for the year ahead, the seminar has contributed to devising orientations aimed at supporting the export capacity of enterprises in the “virtual market”.
Nguyen Phuong Hanh from Vinalink Logistics said that firms need training programs which are suitable to help meet practical demand, while relevant agencies must work to promote these activities, especially within the context of new-generation trade agreements that set forth a number of provisions in terms of e-commerce exports.
Hanh pointed out inadequacies in marketing activities of Vietnamese enterprises, hoping that there will be more seminars in the future to provide consultancy for businesses in the field.
The seminar, hosted by the Department of Trade Promotion under the Ministry of Industry and Trade (MoIT), with numerous representatives from Amazon Vietnam, associations, individuals, and small and medium-sized enterprises (SMEs) in attendance.
Vietnam manufacturing output slides at fastest rate since 2013: PMI
The Vietnamese manufacturing sector had a sharp contraction in manufacturing output amid the coronavirus disruption, seeing the quickest fall in production since June 2013.
According to the latest Vietnam Manufacturing Purchasing Managers’ Index (PMI) survey, the coronavirus has severely impacted the Vietnamese manufacturing sector in February. Output contracted at the fastest pace for over six-and-a-half years, new orders fell for the first time since November 2015, and employee numbers dropped. Meanwhile, lower availability of Chinese goods put upward pressure on input prices and firms absorbed the additional costs amid an inability to increase output charges.
Looking forward, producers were optimistic of an upturn in output over the coming year, but the degree of positivity weakened. The PMI fell below the 50.0 no-change mark in February, signalling a deterioration in business conditions. The result represented the first decline for over four years. A key factor behind the deterioration in business conditions was a marked contraction in factory production during February. Panellists often noted that the COVID-19 had caused disruptions in output, which decreased at the quickest rate since June 2013. The virus also had a negative impact on demand in February.
New orders fell for the first time since November 2015, which was partially driven by a reduction in new export sales. Some survey respondents mentioned weaker order flows from China when explaining the fall in international business. Softer demand conditions led manufacturing firms to cut their purchasing activity midway through the first quarter. The contraction was the first for over four years. The result was driven by declines in both the consumer and intermediate goods sub-sectors. Amid fears regarding the spread of coronavirus, employment in the Vietnamese manufacturing sector fell in February.
The decrease was the first for four months and the fastest for over six-and-a-half years. Investment goods were the only monitored sub-sector to register an increase in staff numbers. The coronavirus also adversely affected supply chains in the latest survey period. Vendor performance deteriorated to the greatest extent since June 2014. All three monitored sub-sectors saw slower delivery times. On the cost front, shortages of necessary inputs led to a rise in cost burdens during February. Some panellists mentioned difficulties in obtaining Chinese goods.
The rate of inflation was softer than that registered in January, however. Despite rising input costs, subdued demand led firms to cut average output prices. The decline was the first for three months and modest overall. Investment goods were the only monitored sub-sector to record higher charges. Finally, firms were optimistic towards the 12-month business outlook, supported by expectations for an improvement in demand. However, the degree of confidence weakened to the lowest in series history, dampened by fears of a prolonged impact from the COVID-19.
The Vietnam PMI is compiled by IHS Markit from responses to monthly questionnaires sent to purchasing managers in a panel of around 400 manufacturers. Cimigo market research have compiled the Vietnam PMI – manufacturing purchasing managers index since 2013.
Thailand-based Super Energy invests in solar power plant in Vietnam
Thailand-based Super Energy’s subsidiary invested in a solar power plant project with the total installed capacity of 50MW in Phu Yen, Vietnam.
Super Energy Corporation Pcl. – a corporation headquartered in Thailand – officially announced its subsidiary’s investment in a solar power plant project with the total installed capacity of 50MW in Phu Yen province, Vietnam.
Solar Energy (Hong Kong) 3 (SSE-HK3), the subsidiary, would purchase 100 per cent of Thinh Long Phu Yen Solar Power (TLPY) from four existing shareholders. The total transaction would roughly value at around $51.158 million, according to its notification of investment to the Stock Exchange of Thailand.
The TLPY project is located in Phu Yen province, Vietnam and has been selling electricity since June 30, 2019 under a Power Purchase Agreement with 9.35 US cents per kWh feed-in tariff for a period of 20 years from the date of commercial operation.
Super Energy has also splashed out on several projects in Vietnam in line with its goal of acquiring renewable energy companies in Southeast Asia and expanding its operation in China, Japan, and Australia.
Phu Yen is regarded as central Vietnam’s third-strongest locality in the development of public solar power projects after Danang and Hoi An.
Previously, this central province built a solar-powered watering system for a sugarcane farm in Son Hoa district and a 30MW biomass power plant.
As of September 2019, Thai direct investment in Vietnam has exceeded $10.4 billion, concentrating on industrial production, processing, and manufacturing.
So far, the largest Thai investment project in Vietnam is the Long Son Petrochemical complex based in the southern province of Ba Ria-Vung Tau’s Long Son commune, with the total investment of $5.4 billion. The complex is expected to be completed in 2023.
Sixth PropertyGuru Vietnam Property Awards opens call for nominations
The sixth edition of the PropertyGuru Vietnam Property Awards, presented by global brand Kohler, is underway with a new timeline. The awards ceremony will also move to a much larger venue to accommodate a larger number of guests.
The GEM Centre in Ho Chi Minh City, the city’s largest conference place, will host the country’s leading annual real estate gala event, which is set to be held on Friday, August 7. The general public is encouraged to submit their nominations through June 5 online here.
Nearly 50 accolades are at stake at the 2020 PropertyGuru Vietnam Property Awards, including honours for the country’s Best Developer, Best Boutique Developer, Best Sustainable Developer, Best Breakthrough Developer, Best Lifestyle Developer, Best Commercial Developer, Best Hospitality Developer, Best Industrial Developer, and Best Mixed-use Developer.
There will be development awards for outstanding new properties in Ho Chi Minh City, Hanoi, Danang, Phu Quoc, Khanh Hoa, and Halong Bay, as well as Best Green Development, various design, and some special awards for CSR (Corporate Social Responsibility) and for Building Communities.
Nominations are expected to cover breakthroughs in development and design as well as achievements in niche property segments for which one of Southeast Asia’s most active real estate markets is increasingly known.
An independent panel of experts will deliberate on these nominations, led by returning awards chairperson Thien Duong, managing director at Transform Architecture.
Following a hugely successful gala event at the InterContinental Saigon Hotel in Ho Chi Minh City last year, the PropertyGuru Vietnam Property Awards’ move to the GEM Centre in 2020 is notable, since the event is expected to host the largest number of guests ever for the prestigious competition, as it continues to influence the local property market by elevating the standard of quality.
The Sixth PropertyGuru Vietnam Property Awards itself is expected to draw in more than 600 guests, including top brass from development firms and execs in property consultancy, construction, marketing, proptech, law, finance, architecture, and design.
The PropertyGuru Vietnam Property Awards began in 2015 with 400 developers, VIPs and real estate professionals from all over Vietnam converging in Ho Chi Minh City to watch the nation’s top developers and best developments vie for 21 accolades.
The 2019 edition of the PropertyGuru Vietnam Property Awards presented 62 trophies and 39 Highly Commended citations to the country’s outstanding companies and properties. These included five new Developer awards that recognised the country’s niche property segments. Gamuda Land Vietnam’s chairman Cheong Ho Kuan was also honoured as the 2019 Vietnam Real Estate Personality of the Year.
Meanwhile, the chief executive of two-time Best Developer (Vietnam) winner CapitaLand Vietnam, Chen Lian Pang, was honoured at the regional grand final following his win as Vietnam Real Estate Personality of the Year in 2016. The 30-year property development and construction veteran received the 2019 PropertyGuru Icon Award at the 14th PropertyGuru Asia Property Awards Grand Final in November, in Bangkok, Thailand. Vietnam hauled four regional trophies at the 2019 Grand Final, including Best Office Development (Asia) for CapitaLand Vietnam’s grade-A commercial project Capital Place.
The 2020 PropertyGuru Vietnam Property Awards is supported by the industry’s leading brands, including returning platinum sponsor Kohler; official portal partner Batdongsan.com.vn; official magazine PropertyGuru Property Report; media partner Vietnam News; official PR partner T&H Communications; official airline partner Thai Airways; and official supervisor BDO, one of the world’s largest auditing and accounting firms.
For more information, email [email protected] or visit the official website: AsiaPropertyAwards.com.
Newly issued Decree 25 unplugs bottlenecks for real estate projects
Decree No.25/2020/ND-CP (Decree 25) issued by the prime minister on February 28, 2020 has broken through the biggest obstacles facing real estate projects nationwide in land bidding and implementation.
On February 28, 2020, the prime minister signed Decree 25 detailing the implementation of a number of articles of the Bidding Law regarding the selection of developers and project implementation.
This new decree replaces Decree No.30/2015/ND-CP with many new points, with the most important being that the land will be allocated to the winning investors immediately after land clearance and compensation activities, as well as the resettlement of residents, is completed.
Decree 25 has also stoppered a glaring hole in the legal framework, as neither the Land Law nor the Bidding Law clarified which steps need to be done to hand over land to winning developers. This has lead to a great many projects that were delayed by multiple years as localities could not hand over sites and projects to developers who had won the bids for them.
According to Dr. Tran Dinh Thien, former director of the Vietnam Economics Institute and current member of the Economic Advisory Team of the prime minister, this decree will facilitate the resumption of a range of projects which have been delay for years, reducing the losses of developers and the whole society.
“This stagnation should have been dealt with a time ago but better late then never, this will be welcomed by developers, especially at when the industry is suffering from the strong impacts of the COVID-19,” Thien said.
Decree 25 is also expected to open up great opportunities for many local authorities and developers, especially the ones that have completed bidding procedures and are waiting for instructions on land allocation across the country.
Banks step up with willing support for COVID-19 times
Many banks have rolled out soft credit packages in a bid to help customers, both retail and corporate ones, to mitigate the adverse impacts of COVID-19.
Privately-held Asia Commercial Joint Stock Bank (ACB) has just launched a major credit package with scale reaching VND25 trillion ($1.1 billion) which will be running until June 30, 2020 to support customers hit by the novel coronavirus (COVID-19) outbreak.
Of the sum, VND13 trillion ($565.22 million) is earmarked for retail customers and the remaining VND12 trillion ($521.74 million) for small- and medium-sized enterprises (SMEs).
For retail customers, short-term loans with the floor interest rate of 7.5 per cent per annum will be rolled out to serve production and business activities, while the rate for medium and long-term loans will be 8.5 per cent.
Short-term supplemental loans will have interest rates from 6.5 per cent per annum. Corporate customers can borrow from 8.5 per cent per annum to cover procurement and repair machinery and equipment, or build workshops, among others. The interest rate for the first term of the loan could be fixed for 24 months.
For its part, Sacombank has offered a credit package worth VND10 trillion ($434.78 million) with interest rate slashed by 2 per cent per year to both retail and corporate customers serving production and business.
The credit package will be available until June 2020 or end when the sum is totally disbursed.
Nam A Bank is rolling out a preferential loan package with the interest rate 0.5 per cent per annum lower than that regulated in the bank’s current interest rate table applied to dong- and dollar-denominated loans.
The programme will be running until the time the government announces that the COVID-19 epidemic is over and is available for businesses operating in travel, aviation, agriculture, food and beverage, and export-import (between Vietnam and countries suffering from COVID-19).
Meanwhile, Eximbank earmarked VND4 trillion ($173.9 million) to lend to SMEs with concessionary interest rates from 6.99 per cent per annum, while simultaneously launching a credit package valued at about VND3 trillion ($130.43 million) with interest rate from 5.5 per cent per annum tailored to big firms.
Slashing interest rates to support firms affected by COVID-19 would inevitably affect’s banks’ profit, yet in the current context, this will help firms weather this stormy time while helping banks avoid escalating bad debts in case firms have to halt production and businesses.
State-owned leading bank Vietcombank estimates that the scale of loans enjoying lower interest rate due to COVID-19 impacts could be around VND30 trillion ($1.3 billion), with about 300 customers who are big businesses, the interest rate reduction comes to about VND300-450 billion ($13-19.56 million).
According to Nguyen Quoc Hung, head of Department of Credit for Economic Sectors under the State Bank of Vietnam, the loan surplus to sectors hit by COVID-19 has reached VND925 trillion ($40.2 billion) until present, equal to 11 per cent of the banking sector’s total outstanding loan balance.
Covid-19 brings losses to flower growers
Days before International Women’s Day (March 8) are often the best for flower sellers at Tây Tựu Flower Village in Hà Nội, but the continuing Covid-19 epidemic has cut sales of flowers in half this season.
Nguyễn Công Cường and his wife have prepared 1,000 roses to deliver to customers. Unlike in other years when they had to hire more people to cut the plants, this season they have done all the work themselves to reduce costs.
Cường said: “Prices of flowers this year have dropped by half. Normally, after Tết we can sell flowers for Valentines’ Day, temple rituals, Spring festivals, and for International Women’s Day. This year, Covid-19 stopped all those things, dumping the prices of the flowers. Most of us face losses.”
His wife, Nguyễn Thị Nga, said: “Now we sell each bouquet of 100 roses at VNĐ100,000 (US$4.3). Last year, the price was VNĐ200,000 or more.”
Planting flowers in four sào (360sq.m) of land, Nga said: “The sales we make this season may not cover rent for land, fertiliser and others. We have two sào with ready-to-bloom flowers, but there are no orders for them.”
Growing more flowers and also more expensive ones, Lê Thị Kỉ is facing bigger losses.
Kỉ said: “My family has more than a dozen sào of lilies that are ready to harvest. At present, a bunch of lilies (with five flowers) are about VNĐ20,000 each. Compared to the prices from Tết holiday, the prices of each decreased by VNĐ35,000.”
Kỉ adds: “The prices are so low, but no one wants to buy them.”
After spending VNĐ100 million on each sào of lilies, Kỉ could only earn between VNĐ50 million and VNĐ70 million.
She thinks the Covid-19 epidemic and postponing of festivals greatly reduces the need to buy flowers for temples and pagodas.
The grower also says: “Ordinary people are worried about the epidemic’s influence on the economy and have started tightening their spending.”
In addition to roses and lilies, owners of gerberas, white daisies, yellow daisies, pink daisies and dahlia gardens in the village also face 30 to 50 per cent losses.
Tây Tựu Flower Village is in Bắc Từ Liêm District, some 20km from the city centre. The 250ha-village supplies flowers to Hà Nội and other northern provinces for big festivals and events.
Deputy PM receives Singaporean energy firm’s leader
Deputy Prime Minister Trinh Dinh Dung on March 3 hosted a reception for Paul Blakeley, President and Chief Executive Officer of Jadestone Energy Inc. – a Singapore-based multinational energy firm.
Jadestone Energy is the parent company of Mitra Energy – which has been operating eight oil projects offshore and in the mainland of Vietnam.
Deputy PM Dung affirmed that Vietnam always welcomes and creates the most favourable conditions for international investors to expand production and business in the country.
To meet Vietnam’s energy need for economic development and energy security, Vietnam encourages enterprises with financial strength and technical experience to participate in developing oil and gas projects, he said.
He highly appreciated Jadestone Energy’s commitment to invest and expand production, and asked the firm to coordinate closely with the Ministry of Industry and Trade and the Vietnam Oil and Gas Group (PetroVietnam) to soon complete necessary procedures for its investment projects.
For his part, Blakeley thanked the Government, ministries and sectors of Vietnam for their support for his firm, adding that Vietnam’s preferential policies for attracting investment, and improvements of business environment have encouraged international investors to expand their operation in the country.
He congratulated Vietnam on its socio-economic development achievements in recent years, affirming that this is a favourable condition for companies like Jadestone Energy to expand investment and production in the Southeast Asian nation.
Jadestone Energy wants to expand investment in oil and gas exploration and exploitation in existing oil fields, and cooperate with Vietnamese partners in developing new offshore projects in the exclusive economic zone and continental shelf, and in the mainland of Vietnam, Blakeley said./.
Binh Thuan announces tourism stimulus programme
Authorities of the south-central coastal province of Binh Thuan on March 3 announced a tourism stimulus programme titled “Oh Wow! Mui Ne”, in a bid to attract more tourists to the province.
Deputy Director of the provincial Department of Culture, Sports and Tourism Nguyen Lan Ngoc said even though Binh Thuan has yet to record any case of the acute respiratory disease caused by SARS-CoV-2 (COVID-19), the epidemic has badly affected its tourism sector.
The stimulus programme is expected to promote the image of Binh Thuan, home to the renowned beach resort town of Mui Ne, as a safe, friendly and quality destination, she added.
Within the framework of the programme, services will be offered at a reasonable cost for both domestic and foreign holidaymakers to the province.
Binh Thuan aims to issue 1 million VIP cards and build brand recognition for the package by 2022 to ensure the quality of its tourism services./.
Minister: Gov’t requests immediate implementation of growth promotion measures
The Government has directed ministries, agencies, businesses, localities and people to keep up with efforts to fulfil both goals of containing COVID-19 outbreak and socio-economic development, according to Minister and Chairman of the Government Office Mai Tien Dung.
Speaking at a regular press conference in Hanoi on March 3 following the Cabinet meeting, the minister said the PM had instructed the immediate implementation of measures to step up production restructuring and remove difficulties for business and production, intensify administrative procedure reform, accelerate public investment disbursement and facilitate credit access.
According to him, aviation, tourism and transport sectors fell into difficulties when many important markets and partner countries such as the Republic of Korea, Japan and European countries were hard hit by the epidemic. Businesses in manufacturing and processing sector also faced the shortage of materials.
At the same time, the minister highlighted bright spots in the socio-economic situation in the first two months of the year.
Despite slower growth in several sectors, the monetary and credit market was basically stable. The consumer price index in February 2020 went down 0.17 percent month-on-month.
Exports picked up 2.4 percent year-on-year to 36.9 billion USD. The index of industrial production rose by 8.4 percent month-on-month and 23.7 percent year-on-year. The two-month index moved up an estimated 6.2 percent.
Over 17,400 new firms were established with a registered capital of nearly 364 trillion VND (15.8 billion USD), up 9.1 percent in volume and 47.1 percent in value.
Around 12,000 enterprises resumed operations, up 17.1 percent.
The minister also said the Government lauded the national steering committee, local administrations, business community and people in the fight against the COVID-19 epidemic./.
Rice export prices surge amid high demand
Prices of rice exports have been surging in recent time due to high demand from some markets such as Malaysia, the Republic of Korea (RoK), the Philippines, and Indonesia, according to the Vietnam Food Association.
Malaysia has agreed to purchase 90,000 tonnes of the grain from Vietnam and will import more in the coming time and the RoK has given a quota of 55,112 tonnes of the food for Vietnam this year.
Meanwhile, the Philippines has been importing a large amount of rice from Vietnam since December 2019. It was the world’s biggest importer of the goods in 2019 and is forecast to maintain this top position in 2020 with the purchase of 2.6 million tonne.
A working delegation from the Philippines’ Ministry of Agriculture is scheduled to visit Vietnamese rice processing facilities in preparation for further import from Vietnam.
Indonesia aims to import about 1 million tonnes of rice this year, up 700,000 tonnes compared to 2019.
Mainland China used to be Vietnam’s biggest rice market for many years, but in 2019, exports to the country declined sharply by 64.2 percent, due to the impact of the acute respiratory disease caused by SARS-CoV-2 (COVID-19)./.
Vinpearl Travel RU – new factor boosting Vietnam-Russia cooperation
Tour operator Vinpearl Travel RU, belonging to the Vinpearl resort company of private conglomerate Vingroup, has became operational in Russia.
The opening ceremony in Moscow on March 3 attracted the participation of Vietnamese Ambassador to Russia Ngo Duc Manh, representatives of the Vietnamese trade office and Vietnam Airlines in Russia, and 150 representatives from 35 local travel and insurance agencies and local media.
Speaking at the event, Ambassador Manh spoke highly of the opening of the Vinpearl Travel RU, saying that the presence of a renowned Vietnamese group in Russia will help boost tourism and people-to-people exchanges and open up more cooperation opportunities between the two countries.
He stated that bilateral tourism cooperation has enjoyed significant development. Vietnam remains a friendly destination to Russians, as it welcomed nearly 650,000 Russian tourists in 2019. In addition, more and more Vietnamese people are choosing Russia as a destination for their holidays.
Ekaterinna Golybieva, Executive Director of Vinpearl Travel RU, said that the company has a big opportunity to develop tourism in Vietnam by increasing the number of Russian arrivals to the country through hi-end tourism products.
She stressed that Vietnam continues to be a safe and comfortable destination for foreign visitors, including Russians, as the country is controlling well the coronavirus disease (COVID-19).
Vinpearl Travel RU will cooperate with the national flag carrier Vietnam Airlines to conduct over 160 flights connecting four Russian cities of Moscow, Vladivostok, Novosibirsk, and Ekaterinburg with Nha Trang and Phu Quoc – the two most popular destinations in Vietnam – in 2020. The first route between Moscow and Nha Trang will be put into operation on March 12 with the frequency of two flights per week./.
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