Vietnam economy

"In terms of Vietnam’s external environment, we see slower external demand, higher inflation and tighter financial conditions," Francois Painchaud, International Monetary Fund regional resident representative for Vietnam and Laos, said at the recent Vietnam Socio-Economic Forum. While 2022 was expected to be a year of booming recovery for Vietnam after two years of Covid-19 impacts, several geo-political developments like the Russia-Ukraine conflict and surging inflation in developed countries are partly delaying the country’s economic revival, he said. Vietnam’s monetary policymakers, therefore, need to be increasingly vigilant of inflationary risks, he added "If sustained inflationary pressure continues to increase, the State Bank of Vietnam (SBV) should tighten further its monetary policy stance and clearly communicate the underlying drivers to help contain inflation." Painchaud also proposed that the central bank provides targeted fiscal support for vulnerable households … [Read more...] about Beware of global economic risks, analysts warn Vietnam

Exports were up 18.2% year-on-year in the first eight months to over US$252 billion, with August shipments rising to a five-month high thanks to recovery in smartphones, computers and garments. The rise is partly attributed to a shift in orders from China to Vietnam as the former pursues a strict Covid-19 policy and an electricity shortage in its southwestern region has affected manufacturing there, according to securities brokerage VNDirect. Another reason is the contribution of foreign-invested companies, lender HSBC said. Vietnam, along with Singapore and Malaysia, has been climbing up the value chain in recent years thanks to its unrelenting efforts to increase manufacturing capacity. Agriculture and fisheries have also helped sustain exports despite tightened spending being seen in major markets such as the U.S. and Europe. Tuna exports to the U.S. and the E.U. rose by 65% and 70% year-on-year in August. The belt-tightening in these markets is increasing demand … [Read more...] about How Vietnam’s exports weathered global storm

Economists on September 16 forecast Vietnam may find it harder to tame inflation in Q4 and 2023. Inflation in Vietnam may continue to expand in the remaining months of the year as market demand rises, experts said on September 16. Customers shop at a supermarket in Hanoi. Photo: Cong Hung The International Monetary Fund (IMF) recently reported global inflation basically showed a sign of peaking in May, except for some specific areas like Europe as the region has suffered from an energy crisis due to the Russia-Ukraine conflict, Can Van Luc, chief economist of the Bank for Investment and Development of Vietnam, told a workshop on inflation, its impacts and policy recommendations for 2022. In the US, inflation seems to have peaked in recent months, Luc said, citing data of the US authorities that the Consumer Price Index (CPI) has declined to 8.3% in August from 9.1% in June. Other key indicators of the U.S. economy declined or saw slight increases. The … [Read more...] about Vietnam may face increased pressure on inflation control: Experts

During a meeting with foreign direct investment (FDI) enterprises on Saturday, the PM said Vietnam would create favorable conditions for foreign companies to invest long-term in the country. He said the Vietnamese government always has consistent policies and solutions to maintain macroeconomic stability, control inflation, and keep a reasonable exchange and interest rate. In the first eight months of the year, FDI disbursement hit $12.8 billion, up 10.5% year-on-year, the highest over the past five years. Recently, many international businesses have been looking for locations to expand operations and diversify supply chain s, with Vietnam emerging as one of the leading choices. Nakajima Takeo, chief representative of Japan External Trade Organization in Hanoi, said that Japanese investment inflows into Vietnam increased by more than 59% last year and over 45% this year. Minister of Planning and Investment Nguyen Chi Dung told the meeting Vietnam would continue improving … [Read more...] about PM calls on foreign firms to keep faith in Vietnam’s investment environment

During a meeting with Prime Minister Pham Minh Chinh on Saturday, a representative of German engineering and electronics company Bosch in Vietnam pointed out the inconsistencies in legal regulations that make it difficult for them to invest in the country. "Quick changes in policy can make it difficult for both businesses and tax authorities to enforce and comply," he commented. The representative said after the 2019 inspection, the tax incentives that Bosch received were partially abolished as per regulations introduced after it made its first investment steps. Such changes went against investment protection terms specified in the Investment Law, he said. Referring to tax policy, a representative of Eurocham also said the top priority for European investors is transparency in tax law development. For many years, Vietnam has used corporate income tax incentives as a top priority for attracting investment. With the Organization for Economic Cooperation and Development to … [Read more...] about Foreign companies in Vietnam seek consistent business environment

Vietnam's economy remains on the road to recovery, but still faces considerable challenges from both the domestic and international fronts. Macroeconomic stability is key for Vietnam to address the growing uncertainties in the global economy. Chairman of the National Assembly Vuong Dinh Hue at the forum. Source: quochoi.vn Chairman of the National Assembly Vuong Dinh Hue gave the remarks at the Vietnam Socio-Economic Forum 2022, themed “Reinforcing the macroeconomic foundation, promoting sustainable recovery and development”, held today [September 18] in Hanoi. According to Hue, the Vietnamese economy is on the road to recovery, with the GDP growth in the first six months hitting 6.42% year-on-year, and  being on track to hit 7-7.5% for this year. International organizations such as the World Bank, IMF, and ADB have forecast positive outlooks for Vietnam with  economic growth in the range of 6.7-7.5% in 2022, and the inflation rate below the Government’s … [Read more...] about Macroeconomic stability key for Vietnam to weather global uncertainties

Experts say wooden furniture represents one of the key export industries that are anticipated to greatly benefit from the impending UK-Vietnam Free Trade Agreement (UKVFTA). Once the trade deal comes into effect, a range of timber and wooden products are poised to enjoy a preferential tariff of 0% in line with the five-year roadmap from the current tax rate of between 2% and 10%. Most notably, there appears to be plenty of demand for Vietnamese wooden products as these items have tended to sell well in the UK market, largely due to their highly-competitive prices and high quality. Several major companies operating in the wood industry in the UK have moved to establish production facilities, or have signed long-term partnership contracts with manufacturers operating in Vietnam, including IKEA, the world’s largest furniture retailer. According to economists, the UKVFTA will not only help to increase the export of this commodity to the UK, but will also serve to create a … [Read more...] about Vietnam becomes sixth largest furniture exporter to the UK

Statistics compiled by the International Trade Center (ITC) indicated that Australia’s import value of wooden furniture in June reached $138.64 million, marking a rise of 9.7% compared to June of last year. During the opening half of the year, Australia’s import value of wooden furniture enjoyed an annual surge of 47.7% to US$871.54 million. The import proportion from the Vietnamese market accounted for 11.8% of Australia’s total import value of wooden furniture throughout the reviewed period, climbing by 1.7 percentage points compared to the same period from last year. This figure shows that there is plenty of room for the export of the product in the near future. Australia also increased its import of wooden furniture during the six-month period, with wood-framed chairs taking the lead with turnover of US$358.14 million, an increase of 66.3% against the same period last year. Furthermore, the import revenue of living room and dining room furniture soared by 46.5% on-year … [Read more...] about Vietnam becomes second largest wooden furniture supplier to Australia

The U.S.'s Synopsys, one of the world’s biggest chip design software companies, is set to invest in and shift its engineer training to Vietnam , Nikkei Asia reported last month. It will train engineers and provide software licenses for a chip design center at the Saigon Hi-Tech Park. Synopsys has two offices each in Ho Chi Minh City and Da Nang with more than 400 employees and plans to add another 300-400. Last month CEO of South Korea’s Samsung Electronics, Roh Tae-moon, told Prime Minister Pham Minh Chinh that his company is working to test manufacture ball grid array products at its plant in the northern Thai Nguyen Province, and start commercial production in July 2023 . Samsung, the biggest foreign direct investor in Vietnam, has completed 85% of its research and development center in the country and hopes to complete it by the end of the year. Another South Korean company, Amkor Technology, earlier this year signed a deal to set up a US$1.6-billion semiconductor … [Read more...] about Vietnam in global semiconductor spotlight as big-name investors show interest

Speaking with PM Li Keqiang by phone Tueday, he said the two countries should work together to "maintain stable bilateral growth." China should streamline its border trade regulations , increase imports from Vietnam and speed up its opening up to more Vietnamese agriculture produce, he said. There should be more high-quality investments and commercial flights, and issues related to existing projects between the two countries should be addressed, he added. Li said the two countries should strengthen economic ties in terms of trade, investment and maintaining supply and manufacturing chains. China is ready to resume activities between the two peoples, welcome Vietnamese students back and increase flights to Vietnam, he added. The two leaders agreed to maintain communication channels about land borders and maritime issues, properly handle differences and maintain peace and stability. They also agreed to work with ASEAN member countries to implement the Declaration on the … [Read more...] about PM Chinh urges China to buy more from Vietnam