Vietnam outstrips Thailand in rice export price
Each tonne of 5% broken white rice from the country was priced US$15 higher in comparison with the same product from Thailand in the world market as of August 8, hovering between US$478 and US$482 per tonne, according to Vietnam Trade Office in Thailand.
This decline in the price of Thai rice exports can largely be attributed to the appreciation of their currency, the baht, against the US dollar, which has consequently seen the neighbouring country’s rice export prices lose its competitive advantage over rivals.
At present, the free on board, also known as FOB, prices of 5% broken rice from Thailand stands at around US$460 per tonne, US$90 higher than Indian rice and US$ 8 higher than Vietnamese rice.
According to the nation’s Trade Office in Thailand, the Thai Government is considering changing policies in rice exports in order to regain the export growth momentum it had in comparison with its competitors such as Vietnam and India.
In line with these changes, amended policies will largely focus on speeding up marketing activities, reducing production costs, and researching new rice varieties.
Furthermore, the Ministry of Commerce of Thailand will work alongside the Rice Exporters Association to seek new partners in order to expand markets as several international partners remain keen on Thai rice as a result of its high quality.
Moreover, various heads of Thailand’s trade offices abroad have been encouraged to organise trade promotion activities whilst seeking out potential markets.
According to a report released by the Agro Processing and Market Development Authority (Agrotrade), Vietnam exported approximately 3.9 million tonnes of rice worth US$1.9 billion during the first seven months of the year, representing a year- on- year decline of 1.4% in volume and an increase of 10.9% in value.
The average export price of rice during the first half of the year also enjoyed a surge of 13% to US$487.6 in comparison to last year’s corresponding period. VOV
RoK tech titans tracking cost advantage
Samsung Electronics is reported to plan to move its PC production from China to Vietnam to lower costs and stay competitive in the PC business. The company could close its factory in China as soon as this month and convert part of the facility into a research and development (R&D) centre. A spokesman said the move to shut the Chinese plant was based on the need to find a cost advantage.
Meanwhile, LG Electronics is developing a new R&D centre in Vietnam as part of efforts to expand its presence in the market. During a recent meeting between Prime Minister Nguyen Xuan Phuc and RoK companies, LG reportedly confirmed the plan. The company already has an R&D centre focused on its vehicle component solutions business in Hanoi. LG said it is currently looking for potential sites in Vietnam but it has yet to confirm detailed plans.
According to the Korea Chamber of Business in Vietnam (KorCham), Vietnam’s great potential in IT and workforce of related engineers has attracted not only Samsung and LG but also many others.
IT recruitment firm TovDev in Ho Chi Minh City said that RoK’s IT companies are planning to come to Vietnam, and they “wish to give the IT talents in Vietnam the opportunity to experience an international and professional working environment to maximise their careers.”
Commenting on this trend, Linda Liu, an economist at Maybank Kim Eng, told VIR that the recent wave of multinational corporations carrying out investments in Vietnam underscores the view that Vietnam continues to position as a major beneficiary of the manufacturing supply chain shift.
RoK remains by far the largest foreign investor in Vietnam. Data from Vietnam’s Ministry of Planning and Investment (MPI) showed that as of July 20, the total registered investment capital from RoK in Vietnam amounted to more than US$70 billion, accounting for 18.4% of total overseas registrations in Vietnam.
This is followed by Japan and Singapore, with the total registered investment capital into Vietnam at US$60.22 billion and US$55 billion, respectively.
“Recent news of RoK investors building R&D facilities in Vietnam like Samsung and LG are positive signs that Vietnam could be gradually moving up the value chain and attracting more high-quality foreign investments,” Liu said.
“This is in line with Vietnam’s new foreign direct investment (FDI) attraction strategy towards 2030 announced late last year, whereby more focus is expected to be placed on attracting FDI in high-tech and environmentally-friendly sectors in the coming decade”, Liu added.
That said, the supply chain shifts towards Vietnam are still likely to occur in a more step-by-step approach, meaning starting with mid-end and simpler product lines such as electronic components and parts, before upgrading to more complex and sophisticated high-tech products.
Dean Rolfe, partner and head of Market Entry at KPMG in Vietnam, told the Vietnam Investment Review (VIR) that one of the causes driving this new high-tech investment into Vietnam is nothing more than a diversification away from China. He added semiconductor sales to China may slow and this might have an impact on high-tech manufacturing from this nation, especially products which are destined for international markets and not internal consumption.
“As a consequence, many enterprises might be looking at a diversification strategy away from China or as a supplemental China+1 strategy. Other enterprises might be seeking cost reductions, while others might be looking at building entirely new high-tech supply chains for products in new geographic locations to reduce cost and widen geographic diversification,” he said.
Kim Heung Soo, chairman of the Korean Chamber of Commerce and Industry, told VIR that RoK’s investment in Vietnam has traditionally been concentrated on the manufacturing industry such as garments, bags, and footwears. However, recently Korean companies’ investment in Vietnam has also been diversifying into high value-added high-tech industries. Besides Samsung and LG, some of the leading companies that actively invest in the industry are Hyosung, SK, and Hyundai Motors.
“However, for Vietnam to develop into an R&D hub, the foundation of the related technology industry must be solid first, and the Vietnamese government needs to actively train a professional workforce. Additionally, there should be preferential benefits such as visa and tax incentives to secure foreign professionals,” Soo said.
Echoing this view, Michael Han, head of SK Group’s representative office in Vietnam, said that it would be a win-win situation for South Korean firms and Vietnam’s economy if more incoming investments are made into high value added industries.
Despite COVID-induced challenges, the economy has endured well compared to some of its peers. But pandemic aside, Han says Vietnam’s economy needs to upgrade its growth drivers and inducement of such investments can definitely help.
“I personally have been taking note of series of announcements on RoK’s R&D investments into Vietnam, which was quite encouraging to see,” Han said.
“Yet, the true benefit for Vietnam can only be meaningful if such R&D investments become a continuous trend, rather than being one-offs. And especially for R&D of higher value added industries, I think the government’s coordinated support is quite vital”, Han emphasised. VIR
Supply of essential goods ensured for consumers amid COVID-19
In the face of complicated developments relating to the novel coronavirus (COVID-19) pandemic, an array of convenience stores and supermarkets have devised plans aimed at ensuring the sufficient supply of goods to meet the general needs of consumers.
As observed by VOV reporters, several major supermarkets such as Big C, Lotte, Vinmart, and Mega Market are still able to offer a plentiful supply of goods on their shelves for consumers to purchase and boast a broad range of available products such as fruit and vegetables, meat, shrimp, and fish at stable prices.
With these efforts, citizens have stated that they are not too worried about the scarcity of goods at supermarkets and markets despite the outbreak of the pandemic as a sufficient supply of consumer goods has been available even during the peak period of the outbreak.
Indeed, important factors for every citizen to remember when going shopping for essential goods is to continue wearing face masks, making us of hand sanitizer, and obeying social distancing regulations when at crowded places, they emphasise.
Representatives of supermarkets and shopping centres state that in addition to products serving a role in epidemic prevention such as medical masks and hand sanitizer, businesses have managed to increase their sources of food, aquatic products, especially with regard to essential goods to satisfy people’s needs.
Amid the complicated pandemic situation, BRG Group has directed BRG Retail Co., Ltd., also known as BRG Retail, to re-launch the COVID-19 epidemic prevention system awell as ensuring a full supply of essential products at stable prices. This should be done across the entire system of 50 Minimart supermarkets under BRGMart in Hanoi, Hung Yen, Hai Duong, and Hai Phong.
Vu Thi Hau, chairwoman of the Vietnam Retailers Association, says that from now until the end of the year, retailers have signed contracts with manufacturers in order to increase inventories by between 15% and 20% as a means of ensuring a consistent supply of goods for local people.
“The retail systems, supermarkets, and food stores all ensure the quantity of goods that are served as required by consumers. Additionally, scenarios have been outlined to prevent shortage of goods and abrupt increase in prices. Retailers have also actively exploited sources of goods to offer best services to consumers”, Hau adds. VOV
COVID-19 knocks out over 9,000 companies a month across Vietnam
While Vietnam has fared better than most in the face of COVID-19, it has not gotten away scot-free as can be seen in the 9,000 companies closing every month this year.
Of these, real estate, tourist accommodation establishments, cuisine, and entertainment are the sectors suffering the heaviest damage with the highest rate of temporary operation cancellation.
According to the authority, the local economic recovery has been at a snail’s pace while the pandemic’s implications are growing serious across the globe.
To illustrate this, about 32,722 businesses registered to briefly halt operations in the first seven months of the year, up 41.5 per cent on-year. Most of them operated for less than five years with capital scale of less than VND10 billion ($434,780).
Otherwise, during the first seven months 75,249 companies were founded, down 5.1 per cent on-year, with agriculture-forestry-seafood and water manufacturing and distribution being the two segments seeing the most new businesses, with the on-year growths of 20.9 and 190.7 per cent, respectively.
The authority also stated that the pandemic has affected business strategies, with businesses shifting to the sectors with fewer risks such as electricity, water supply, and gas, among others – essential utilities that are less affected by the health crisis.
The authority added that companies have tended to reduce their scope of operations.
Ha Long tour boat owners halt business due to Covid-19
More than 100 tourist boat owners in Ha Long City have filed to suspend operations to apply for a tax discount in August due to Covid-19.
Before the second wave, Quang Ninh Province welcomed hundreds of thousands of visitors a day. Ha Long Bay received 30,000 visitors each day. However, now over 500 tour boats only serve 200 visitors.
Over 100 boat owners under Tuan Chau Boat Group and Sun Group Port Group have suspended business from August 1 to 29 to apply for tax relief. According to the boat owners, they still have to pay taxes, wages, insurances and other fees for VND5m to VND10m a month even there are no customers.
On April 14, the Cruise Boat Branch of Ha Long asked the Taxation Department in Ha Long to provide support to boat owners amid the pandemic with adjusted tax rates.
Nguyen Van Phuong, vice head of Cruise Boat Branch of Ha Long, said, “On April 27, the Taxation Department said there was no clear lump sum for them to calculate the taxes on. However, when the tourism activities were resumed on May 1, many owners complained that the tax rates remained the same as last year and they couldn’t pay the tax when they didn’t have customers.”
Banks cut home loan interest rates
Interest rates of home loans at commercial banks have tended to reduce significantly since the second half of July due to low capital demand from business and production.
The home loan interest rates at State-owned banks, including Vietcombank, BIDV and VietinBank were cut by 0.2-1 percentage points per annum for different terms from the end of July 2020.
Specifically, the preferential interest rate at BIDV was lowered from 8 per cent to 7.8 per cent per annum on 12-month terms, from 9 per cent to 8.8 per cent per annum on 24-month terms. By the end of the preferential period, the average lending rate is 10.1 per cent per annum, on a borrowing period of 20 years.
At Vietcombank, home loan interest rates were cut from 8.1 per cent to 7.7 per cent per annum for a preferential term of 12-month. Particularly, Vietcombank provides seven interest rate options so that homebuyers can take the initiative in calculating loan plans.
At foreign-owned banks such as Standard Chartered, UOB, HongleongBank, HSBC and Shinhanbank, the average interest rate of home loan packages is listed at 6.49-8.8 per cent per annum for one- to three-year loans. In the following years, the additional rate is 1.5 3.9 per cent per annum based on the deposit interest rates for terms from six months to two years, fluctuating from 10 to 10.5 per cent per annum. The borrowing terms are from 20 to 25 years, thoibaonganhang.vn reported.
For the group of private joint stock banks, Techcombank made the largest interest rate decrease to home loan packages. Accordingly, the bank stimulates home loans with a long term of 35 years with preferential interest rates of only 8.29 per cent per annum in the first year. After the preferential period, loans of more than VND5 billion are offered with an attractive rate of 10.8 per cent per annum.
Other private commercial banks, such as MB, TPBank, VPBank and VIB, also listed 12-month preferential interest rates for home loans at 7.7-10.1 per cent per annum. After the preferential period, the rates will be adjusted to about 11-15 per cent per annum.
According to experts, banks’ interest rate cut for home loans is mainly aimed to boost credit growth targets in the middle of low capital demand for production and business activities due to the impact of the COVID-19 pandemic. The credit growth expanded only 3.45 per cent at the end of July this year.
Besides, banks currently also prefer home loans because they are secured and less risky than loans for business purposes. The sharp interest rate decline to the lowest level in the past ten years is also creating favourable conditions for more people to own home.
However, the current biggest obstacle is that housing prices are still relatively high compared to people’s incomes. Therefore, even when the interest rate level has fallen sharply, it is not enough to encourage people to buy houses.
Thus, if localities, especially big cities like Ha Noi and HCM City can boost the supply of small apartments, social housing and commercial housing for low-income people with prices of less than VND2 billion per unit, the home loans will grow strongly in the next one or two years as demand for the housing segments has remained high.
Statistics of many real estate exchanges from early Q2 2020 until now have pointed out that the number of searches for small apartments with an area of about 45 square metres increased strongly by more than 200 per cent compared to the previous quarter. VNS
Pandemic restricting local oil groups
The return of coronavirus in Vietnam is once again dragging down local oil businesses as a silver lining for their recovery has been rocked.
As domestic oil firms hope for rejuvenation after the damage caused by the pandemic in the year’s first half, the new outbreak has stalled them further, resulting in a great downturn in their stock prices.
Over the past two weeks, Petrolimmex (HSX: PLX) saw a decline of 6.42 per cent to VND44,450 ($1.93) per share, while PVOil (UPCoM: OIL) dropped by 7.41 per cent to VND7,500 ($0.32) per share. PetroVietnam Drilling and Well Service Corporation (HSX: PVD), PetroVietnam Technical Services Corporation (HNX: PVS), and PV Gas (HSX: GAS) also recorded cutbacks of 4.29, 4.8, and 3.62 per cent to VND10,050 ($0.43), VND11,900 ($0.51), and VND69,300 ($3), respectively.
According to Bao Viet Securities, the local oil and gas industry will find it hard to recover in the second half, especially PVS, GAS, and PVD which are depending on the global oil market.
PVD, for instance, has been poring over a hefty dilemma. Due to pandemic lockdowns in Malaysia, the arrival of high-skilled labourers to Vietnam has been restricted, bringing about shortcomings in labour resources. Currently, many Malaysian experts are working on PVD projects in Vietnam. Moreover, due to the plummeting demand for oil, PVD’s customers have tended to lessen or extend the timeline for exploitation, affecting the progress of its drilling rigs.
In a recent business report, PVD stated that the last six months of 2020 will remain burdensomme for the company because the health crisis remains rampant in the United States, Brazil, India, and Russia. Additionally, the oil price has been low.
However, in the first half of this year, the company estimated to have fetched about VND3.18 trillion ($138.2 million) in revenue, up 66 per cent on-year. After-tax profit also reached VND85 billion ($3.7 million), up 204 per cent on-year.
Explaining the growth, PVD revealed that performance of its drilling rigs has been stable over the peak of the pandemic with 3.56 jack-up rigs (higher than the 3.45 last year) and a 9 per cent increase on-year in rig-leasing price.
PVS has been sharing these difficulties with some contracts providing services in Qatar. As the COVID-19 situation is growing in complexity, the arrangement of overseas personnel for the projects has been restricted, impacting its profit in the next quarters, according to SSI Research.
The company’s revenue dropped 26.4 per cent in the first quarter to VND3.01 trillion ($130.87 million). Also, net profit was VND128 billion ($5.56 million), down 67 per cent on-year.
In the morning of August 6, crude oil rose a few cents after sharp growth in the previous day. According to Dow Jones, WTI increased by 49 US cents or 1.2 per cent to $42.19 per barrel, and Brent went up by 46 US cents or 1.7 per cent to $45.17 per barrel.
Furthermore, the COVID-19 outbreak earlier this year drew the oil price down to a historical low, dealing a significant blow to companies in the gasoline business such as Petrolimex, PVOil, and Binh Son Refining and Petrochemical Co., Ltd (UPCoM: BSR), which all reported in losses in the first quarter due to cutting the price of inventories.
Nguyen Duyen Cuong, deputy general director of Binh Son Refining and Petrochemical, told VIR that as China occupies 17 per cent of global GDP, the fall in oil price caused by the health crisis will keep impacting the local petroleum industry. Oil refineries in the whole world are estimated to cut 3-5 per cent capacity, affecting petrochemicals.
“To deal with the burden, BSR will keep boosting negotiations with oil field owners by comparing the common price in the market to get the most favourable purchasing price,” said Cuong. VIR
PM approves investment plan for Dong Dang-Tra Linh Expressway
Prime Minister Nguyen Xuan Phuc has approved the investment plan for the Dong Dang-Tra Linh Expressway under the public-private partnership (PPP) model.
The People’s Committee of Cao Bang is assigned to sign the contract with the investor of the project.
The expressway, which is 115km in length, connects the northern mountainous provinces of Lang Son and Cao Bằng. It will have four lanes and allow vehicles to travel at speeds of up to 80km per hour.
The total investment for the project is estimated at nearly VNĐ21 trillion (US$895.75 million). It is divided into two phases.
The first phase, which will be carried out in 2020-24, will connect the Tan Thanh border gate in Lang Son Province to Phuc Sen Commune in Cao Bằng Province’s Quang Hoa District. The second phase, which will be implemented after 2025, will be from Quang Hoa District to the Tra Linh border gate in Cao Bang Province.
Toll collection on the entire expressway and toll collection on the route connecting Cao Bang City will be used to recover the project’s investment capital.
The project is expected to boost socio-economic development in the two provinces and ensure national defence and security, as well as the country’s border sovereignty.
It also serves as a new route facilitating transportation of goods from Lach Huyen International Port (Hai Phong) to Chongqing-Urumqi (China)-Khorgos city (Kazakhstan) to European countries. VNS
SCIC finds 46 million FPT shares unmarketable
After registering intentions to sell more than a month ago, no investors paid attention to FPT shares divested by State Capital Investment Corporation (SCIC).
Previously, in early July, SCIC announced putting 46 million FPT shares on sale via an auction with the initial price of VND49,400 ($2.15), equaling a total of VND2.3 trillion ($100 million). The offered price is higher than the current transaction price of VND47,000 ($2.04). The shares are not available for foreign investors because FPT has hit the foreign ownership limit (FOL).
At present, the FOL at FPT is 49 per cent, including Macquarie Bank Limited with 5.37 per cent, Red River Holdings (3.43 per cent), GIC (2 per cent), and investment groups relating to Dragon Capital (9 per cent).
FPT reported VND13.61trillion ($591.74 million) in revenue and VND2.42 trillion ($105.22 million) in pre-tax profit in the first six months of this year, signifying increases of 9 and 14 per cent on-year.
FPT is one of the top 10 most valuable brands in Vietnam 2020, according to Forbes Vietnam magazine.
FPT is the largest IT company in Vietnam. The core business lines of the company include three main sectors: IT, telecommunications, and education. It undertakes software development for many foreign clients, with half of its orders coming from Japan. The company went public on the Ho Chi Minh City Stock Exchange in 2006.
The group is looking like the clear favourite to develop the central province of Binh Dinh’s ambitious AI hub, which is planned to turn the province into a regional and global powerhouse in AI development.
In addition, FPT is operating a number of projects on AI and high-tech education in the province. These initiatives are said to position the group favourably to be selected as the developer of this particular centre, which is planned to be built on a large golden location at the centre of Quy Nhon city.
In September 2018, Taiwan’s Synnex Technology International Corporation bought 30 per cent of the shares of FPT Retail and 47 per cent of the shares of FPT Trading from FPT Corporation. VIR
HCM City footwear firm continues mass layoffs due to Covid-19
Hue Phong Leather Shoes Company Ltd. Co. in HCM City will continue laying off a large number of its workers in late August due to the Covid-19 pandemic.
According to Pham Van Tai, vice chairman of Go Vap District’s Labour Federation, the company planned to lay off 1,577 workers on August 30.
The company will have to spend over VND31 billion (USD1.34 million) on compensation payments.
Among those, 198 female workers who are going to have maternity leave in the coming time will be supported with voluntary health insurance.
Tai added that the pandemic has caused Hue Phong’s major partners from the US and Europe to cancel their orders, bringing hefty losses for the company.
The company earlier laid off around 2,500 workers between May and June because of Covid-19-related challenges. These people were later introduced with job opportunities by the HCM City Department of Labour, Invalids and Social Affairs and the city’s Labour Federation.
Up to more than 327,000 employees in HCM City lost their jobs in the first half of this year as a result of Covid-19 pandemic, the highest tally for the past four years. Dtinews
Vietnam, Venezuela seek to propel trade links forward
The event saw approximately 60 invited guests come together, alongside business representatives from both countries.
During his address, Vietnamese Ambassador to Venezuela Le Viet Duyen stated that the Vietnamese Government and people will always place great importance on promoting friendly relations and bilateral co-operation, especially with regard to the potentially strong sectors of the two nations.
The diplomat also gave assurances on the country’s readiness to share its experience with Venezuela in terms of national construction and development, particularly in the context of the spread of the novel coronavirus that has served to adversely affect the economic and social life of global and regional food security.
With regard to trade and economics, Venezuela can be considered a potential market for the country that is able to meet the goals of market expansion and diversification set by local firms.
Most notably, both nations are enjoying a window of opportunity in order to strengthen bilateral economic and trade co-operation whilst also promoting their comprehensive partnership.
In addition to trade exchanges, the two sides also boast huge potential to enjoy greater co-operation in fields such as energy, oil and gas, seafood, consumer goods manufacturing, health care, science and technology, and most significantly, agriculture.
The seminar saw entrepreneurs set up connectivity, introduce agro-forestry-fishery products, whilst sharing experiences in order to take full advantage of various business opportunities.
Located in South America, Venezuela has great potential for agricultural development which has yet to be fully tapped into. The Venezuelan Government is ready to offer great incentives to Vietnamese enterprises who are willing to invest in production and business activities in this field. Indeed, each year sees Venezuela import a large amount of food to serve domestic needs, with its rice volume standing at roughly 500,000 tonnes per year.
Ambassador Duyen described how the event is an excellent opportunity to connect firms from the two countries, whilst also deepening mutual understanding and grasping requirements and opportunities to further develop bilateral trading ties, especially in terms of the agricultural sector.
The seminar was also viewed as a contributory factor to promoting economic co-operation and raising two-way trade turnover on a par with the comprehensive partnership between the two nations, the Vietnamese diplomat added. VOV
Indonesia: Retail sales improve in June
A survey by the Bank of Indonesia (BI) revealed that retail sales in the country improved in June, though it is still in a contractionary phase.
Real Sales Index (IPR) in June contracted 17.1 percent year-on-year, improving from a contraction of 20.6 percent year-on-year in May.
Sales improvement was seen in almost all commodity groups surveyed, especially for motor vehicle fuels, food, beverages and tobacco, and information and communication equipment, in line with the easing of large-scale social restrictions.
In July, there were indications that retail sales performance will continue to improve, even though it is still contracting. This is reflected in the forecast for July IPR growth of minus 12.3 percent year-on-year, up from minus 17.1 percent in the previous month.
Inflationary pressure is predicted to ease in the third quarter of 2020, and to increase in the second half of the year.
Meanwhile, the GPIE for the next 6 months was recorded at 156.1, higher than the previous GPIE of 142.5. This increase is in line with the predicted increase in activity during the Christmas and year-end holidays./.VNA
LOGOS plans to pour $400 million in Vietnam
Australian real estate group LOGOS is the latest name shifting business to Vietnam as US-China tensions are growing fiercer.
LOGOS, a member of Sydney-headquartered ARA Group, has just revealed the plan of mobilising $1.2 billion to enter Vietnam and South Korea, according to newswire DealStreetAsia.
The company is calling $400 million for its blueprint in Vietnam and also $800 million in South Korea. Previously, LOGOS assembled investments from Canada Pension Plan Investment Board and Ivanhoe Cambridge, among others for its expansion plan in Singapore and Indonesia.
Most recently, the company has assigned Glenn Hughes, former director of Capital Project & Infrastructure at PwC Vietnam, to the position of head of the country. Looking further, LOGOS will focus on merging and developing lashings of brands major in logistic, e-commerce, and food, among others.
“Vietnam came on the global stage two years ago. We were first asked to come to Vietnam to support one of our major customer’s interest in Ho Chi Minh City. As we opened doors with other customers, our commitment to set up in Vietnam was resolute as the needs of these companies became evident,” one of the company’s founders quoted by DealStreetAsia.
He also said that as the global supply chain is under degradation due to the trade war, Southeast Asia has arisen as an immense potential investment opportunity for overseas investors.
Before draining capital to Vietnam and South Korea, LOGOS invested about $400 million in Indonesia in 2019. On the other hand, the company has cancelled all operations in China worth $800 million since April 2020. VIR
Lotte Chemical has acquired Vietnamese high-tech material company Vina Polytech
Lotte Chemical has recently acquired Vina Polytech to realise its vision of becoming the seventh-largest chemical company in the world, as reported by businesskorea.co.kr.
Established in May 2010, Vina Polytech manufactures PC plastic and ABS plastic pellets. Located in Bac Ninh Industrial Zone, the company has registered investment capital and charter capital of $1.2 million.
Shortly after the acquisition of Vina Polytech, Lotte Chemical set up a local corporation in Indonesia under the name of PT Lotte Chemical Engineering Plastic Indonesia. It established the company to build a compounding product plant that produces high-tech materials for automobiles. Lotte Chemical has expanded its business in Southeast Asia, which had previously been focusing on basic materials, to include high-tech materials. VIR
Vietnam-based Korean firms looking to benefit from EVFTA
The EU-Vietnam Free Trade Agreement (EVFTA) coming into force on August 1 will benefit Vietnam-based Korean companies exporting goods to the EU.
The report stated, “A high level of market opening is expected as the EU and Vietnam agreed to eliminate around 99 per cent to 100 per cent of tariffs based on import bill within 7 years and 10 years, respectively,” and added, “As Vietnam’s institutional reform, mitigation of non-tariff barriers, protection of intellectual property rights, and strengthening of labour rights and environmental protection obligations are included in the agreement, it will play a major role in advancing Vietnam’s economy as well as expanding overseas investment.”
In particular, Korean textile and fashion firms based in Vietnam are expected to benefit from this FTA. Under the agreement, Vietnam-based Korean clothes manufacturers exporting to the EU can enjoy a preferential duty for goods made from Korean materials as the EU has FTAs with both Vietnam and South Korea.
In contrast, clothes produced from Chinese materials cannot enjoy the benefits of the EU-Vietnam trade deal, as China does not have an agreement with the EU.
Currently, the EU depends on China for 30 per cent of its clothes imports, but it imposes tariffs of up to 12 per cent. These imports will likely be replaced with Vietnamese goods when tariffs are removed.
In addition, the EU-Vietnam agreement is expected to increase demand for high-quality Korean materials. Since tariffs on consumer goods from Vietnam such as shoes and bags are significantly lowered, Korean producers based in Vietnam will be able to expand exports to the EU.
Kim Jung-kyun, a senior researcher at the Korea International Trade Association, said, “Vietnam has been making aggressive moves to open up its markets. It currently holds FTAs with 52 countries and has emerged as the trade hub of the ASEAN region. Korean companies based in Vietnam need to actively utilise the FTA network built by the country and set up mid-to-long-term strategies to expand trade and investment in Vietnam and restructure the supply chain.” VIR
Work starts on US$96.84 million white limestone processing factory in Yen Bai
The Vu Gia Yen Bai Mineral Processing and Exploitation Joint Stock Company started construction work on a factory manufacturing and processing white limestone in Yen Bai province on August 11.
Covering a total of nearly 26 hectares in Thinh Hung commune, Yen Binh district and Bao Hung commune, Tran Yen district, the project has a total investment of VND2,240 billion (US$96.84 million).
The factory will be installed with the latest fuel-saving and environmentally friendly technologies in order to produce products of high quality.
The first phase of the project is expected to be completed in the fourth quarter of 2021 and the second phase is scheduled for completion by 2024, providing paving stones and white limestone powder for the domestic market and export.
Once it is operating, the factory is envisioned to earn an annual revenue of VND2 trillion, contribute VND80 billion to the State budget every year, and create jobs for around 500 local employees.
According to the Chairman of Yen Bai provincial People’s Committee Do Duc Duy, the operation of the project will contribute to improving the locales’ income, and increasing the industrial production value and export value of the province, thereby boosting the locality’s socio-economic development.
It also reflects the provincial authorities’ effort to reform administrative procedures, improve the business environment, and facilitate all economic sectors, particularly the private sector. Nhan Dan
Vietnam, China look for ways to bolster trade
Vietnam and China should extend the working hours for customs clearance at border gates and restore cross-border trade at markets along the border, Le Hoang Oanh, Director of the Ministry of Industry and Trade (MoIT)’s Asia-Africa Market Department, told an online meeting on August 13.
Oanh made the proposal during the 9th meeting of the Vietnam – China working group for economic and trade cooperation, which was held in the form of video conferencing for the first time.
The meeting is held annually within the framework of the two countries’ Economic and Trade Cooperation Committee to seek ways to resolve problems standing in the way of bilateral economic and trade relations.
Two-way trade maintained stable growth during the first seven months of this year despite COVID-19, while many issues mentioned at the 8th meeting have been solved. Of particular note, four more Vietnamese milk producers gained access to China, while three others Vietnamese companies regained permission to export fish powder. The two countries have also agreed to add the Dong Dang – Pingxiang railway border gates to the list of international border checkpoints where Vietnamese fruit can be exported to China.
Also head of the working group on the Vietnamese side, Oanh suggested China allow more border checkpoints to handle agricultural and aquatic products from Vietnam.
She urged the country to provide Vietnamese agricultural products with broader market access, and promote trade promotion activities using digital platforms, saying Vietnam wants to establish a trade promotion office in Chengdu city, Sichuan, in western China.
The Chinese side spoke highly of and agreed with Vietnam’s constructive proposals. China also asked Vietnam to support the entry of Chinese experts, investors and technicians into Vietnam.
According to the General Department of Vietnam Customs, Vietnam – China trade rose 4.79 percent year-on-year to 65.18 billion USD in the first seven months of this year, with Vietnam’s trade deficit falling 16.38 percent against the same period last year.
China remains Vietnam’s largest trade partner, while Vietnam has become China’s seventh-largest trade partner. VNA
Petrolimex to offer 13 million treasury shares for sale
The Vietnam National Petroleum Group (Petrolimex) plans to sell 13 million treasury shares, the company said on August 12.
If successful, the total number of treasury shares will fall to more than 75 million.
The decision was made on August 11, but there is no schedule for the share sale yet.
Petrolimex shares, listed on the Ho Chi Minh Stock Exchange with code PLX, inched up 0.2 percent to trade at 46,600 VND (2.02 USD) apiece on August 13.
The petrol and fuel seller between June 16 and July 2 sold 15 million treasury shares for average 45,318 VND apiece to receive nearly 680 billion VND.
Due to the COVID-19 pandemic, Petrolimex forecast total revenue in 2020 will fall 35 percent on-year to 122 trillion VND (5.28 billion USD) and pre-tax profit will drop 72 percent on-year to 1.57 trillion VND.
In the first six months of the year, the company earned 65 trillion VND worth of total revenue but suffered a net loss of 1.2 trillion VND. VNA
Webinar explores longan export opportunities
An international business matching webinar was held in Hanoi on August 13 in an effort to promote the export of Vietnamese longan.
Deputy Minister of Industry and Trade Do Thang Hai told the online gathering that the quality of Vietnamese longan and related products, like dried longan and canned longan juice, has improved over time and are now found in major markets such as China, Australia, the US, Singapore, the Republic of Korea, Malaysia, Japan, Europe, and the Middle East.
Vietnamese longan meets the requirements of importers, including those relating to origin traceability and plant quarantine, which means its quality has been recognised and can win over other demanding markets, he said.
Hai views the export potential of the country’s fresh longan and related products as substantial.
Localities with large areas of concentrated longan growing like Hung Yen, Son La, and Hai Duong provinces have been perfecting their production processes and developing standardised cultivation zones to boost exports, he added.
According to Deputy Minister of Agriculture and Rural Development Le Quoc Doanh, the ministry is coordinating with the Ministry of Industry and Trade to negotiate the opening up of more markets for Vietnamese longan and other fruit.
More than 70 businesses and farm produce importers in eight markets – India, Australia, the Republic of Korea, the US, Malaysia, Japan, Singapore, and China – discussed the longan trade with Vietnamese farms, cooperatives, and businesses from Hanoi and HCM City as well as Ben Tre, Bac Giang, Binh Duong, Hung Yen, Lang Son, and Son La provinces. VNA
Buon Ma Thuot Coffee Festival postponed
The Government has approved the postponement of the eighth Buon Ma Thuot Coffee Festival, initially slated for March 2021 in the central highlands’ province of Dak Lak, due to COVID-19.
The office of the provincial People’s Committee said on August 13 that the province plans to reschedule the event, with the theme “Dak Lak – A Destination of World Coffee”, to 2022.
The festival is a national event held biennially in March.
The seventh holding took place from March 9 to 16, 2019, with the theme “The Quintessence of the Jungle”, and attracted more than 50,000 visitors, including nearly 6,000 foreigners.
Dak Lak is home to the largest coffee farming area in Vietnam, with more than 200,000 ha producing about 460,000 tonnes of beans every year. VNA
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