Category: Business

An investment, trade and tourism promotion conference to boost cooperation between the north-central province of Thanh Hoa and Japan opened in Tokyo on November 22.

Co-organised by a high-level working delegation of Thanh Hoa province, the Vietnamese Embassy in Japan, the Japan External Trade Organisation (JETRO) and the ASEAN – Japan Centre, the event is part of a series to mark the 50th anniversary of the establishment of diplomatic relations between Vietnam and Japan.

Addressing the event, Secretary of the Thanh Hoa provincial Party Committee Do Trong Hung said that in the province’s development plan during 2021-2030 with a vision to 2045, Thanh Hoa aims to become a new growth hub, together with Hanoi, Hai Phong, and Quang Ninh.

He emphasised that the province highly values the prestige, role and importance of foreign investors, especially those from Japan. Currently, the province has set up a Japanese support department (JAPAN DESK) and it is perfecting the Vietnam-Japan Friendship Association in the
province in order to strengthen investment, trade and tourism promotion between the two sides.

The official affirmed that Thanh Hoa always welcomes Japanese investors with not only many incentives but also specific efforts such as improving transportation infrastructure, human resources quality, administrative procedures as well as quality of services.

Ambassador Pham Quang Hieu expressed his hope that through the event, Japanese investors will have a better understanding of the investment and business environment in Thanh Hoa.

On the occasion, the delegation also paid a courtesy visit to Nikai Toshihiro, former General Secretary of the Liberal Democratic Party (LDP) of Japan and Chairman of the Japan-Vietnam Parliamentary Friendship Alliance, and had working sessions with the JETRO leadership and representatives of large enterprises investing in Thanh Hoa province such as Sumitomo Group and Idemitsu Group.

Hung and Niigata Hanazumi Governor Hideyo signed a Memorandum of Understanding between the two loca
lities on a bilateral cooperation and development plan in the medium and long term./.

Source: Vietnam News Agency

Prime Minister Pham Minh Chinh has urged greater efforts to promote credit access, thus boosting corporate bond and real estate markets in a safe, healthy and sustainable fashion.

In a dispatch issued on November 23 and sent to relevant ministers, the central bank governor and local leaders, the PM stresses that despite joint efforts, the corporate bond and real estate markets have yet to improve as expected, with low credit growth, difficulties in capital absorption, and increasing bad debts.

Given this, he asks the Ministry of Finance to coordinate with concerned agencies to continue rolling out the fiscal policy in a suitable, focused and effective manner, and combine it with the monetary policy to promote investment, especially the non-state capital flow.

The ministry needs to quickly review and thoroughly evaluate the payment capacity of corporate bond issuers, especially bonds due for payment in late 2023 and 2024. It also needs to assess the implementation of Decree No. 08/2023/ND-CP, dated March 5
, 2023 and other documents regulating the trading of corporate bonds in the domestic market and offering of corporate bonds in international market.

The PM asks the ministry to work together with the Ministry of Justice, Ministry of Planning and Investment, the State Bank of Vietnam (SBV) and other agencies to look back on legal documents on the issuance of corporate bonds, and propose specific plans for legal adjustments and supplements, which should be completed in early December.

Meanwhile, the SBV is urged to keep a close watch on market developments to operate monetary policy and control credit growth, he said, suggesting that priorities should be given to production and business, and such growth engines as investment, consumption, export, digital transformation and green transition.

The bank should take solutions to effectively roll out the 120 trillion VND (4.9 billion USD) package in preferential lending rates for social housing development and purchase, and push ahead with the 15 trillion VND pack
age in the forestry and fishery sectors.

The outcomes of the implementation of the social housing package must be reported to the PM within this month, according to the dispatch.

The leader also requests the bank to facilitate credit access by businesses and people, further streamline administrative procedures, and strictly handle commercial banks that seek ways to hinder credit access by real estate firms and buyers.

The Ministry of Construction is tasked to coordinate with National Assembly agencies and others to review and perfect the draft Housing Law (amended) and the revised draft Law on Real Estate Business, which are expected to be adopted at the sixth sitting of the 15th legislature.

The Ministry of Natural Resources and Environment will guide localities to remove obstacles to land allocation and lease, especially in land pricing, management and use.

The People’s Committees of centrally-run cities and provinces are asked to speed up the building and approval of planning schemes which serve as a
foundation for the rollout of real estate projects, and publicise the list of real estate projects that need to select investors in the form of bidding./.

Source: Vietnam News Agency

Transactions with a value of 400 million VND (16,520 USD) or more must be reported to the State Bank of Vietnam (SBV) from December 1, 2023, according to a new regulation.

Under Prime Minister’s Decision 11/2023/QÐ-TTg, the new regulation is applied to financial institutions; and organisations and individuals engaged in related non-financial businesses as prescribed in Clauses 1 and 2, Article 4 of the Anti-Money Laundering Law.

It affects financial institutions licensed to perform one or several activities including: acceptance of deposits; lending; financial leasing; payment services; intermediary payment services; issuance of negotiable instruments, bank cards, money transfer orders; bank guarantees and financial commitments; provision of foreign exchange services and monetary tools in the currency market; securities brokerage; securities investment consulting, securities underwriting; securities investment fund management; securities investment portfolio management; life insurance business; and currenc
y exchange.

Relevant non-financial businesses and professions carrying out one or several activities including prize-awarding games (including electronic games); telecommunications network-based games; Internet-based games; casinos, lottery and betting; real estate transactions except real estate leasing and subleasing activities and real estate consulting services; trading precious metals and gemstones; providing accounting services, notary services and legal services by lawyers and law-practicing organizations; services for establishing, managing and operating businesses; director and secretary services for third parties; and legal agreement services will also have to comply with the decision.

Currently, the value of transactions to be reported to the SBV is 300 million VND./.

Source: Vietnam News Agency

A series of conferences discussing market connection solutions for Vietnamese food and agricultural products are taking place in Ho Chi Minh City within the framework of the ongoing Vietnam Foodexpo 2023 hosted by the Ministry of Industry and Trade (MoIT).

At a conference themed “Vietnamese agricultural products and food in the digital era”, many experts and representatives from businesses updated relevant regulations, mechanisms and policies on applying information technology (IT) and digital transformation in trade promotion activities.

According to Deputy Minister of Industry and Trade Do Thang Hai, with unique advantages and potential, the food industry is considered one of Vietnam’s spearhead industries which plays an important role in promoting exports.

The MoIT is actively coordinating with many related units to promote activities and solutions for developing markets, improving product quality, building brands and gradually increasing the export value of Vietnamese food in the international market
as part efforts to promoting sustainable development of the food industry, Hai said.

Although facing many difficulties due to the impact of the economic situation both at home and abroad, Vietnam’s export prospects, especially for the farm produce and food industry, to major markets, still remain positive, he stressed.

The Vietnamese business community has increasingly focused on applying IT and digital transformation to expand sale channels, increasing investment in digital technology, researching and developing products, building brands, and strengthening trade promotion, he added.

According to Marketing Director of Alibaba.com Vietnam Nguyen Thi Phuong Uyen, this unit and the MoIT’s Vietnam Trade Promotion Agency (Vietrade) are coordinating to develop a Vietnam pavilion on Alibaba.com, which gathers typical products and businesses participating in the global business-to-business (B2B) e-commerce platform to help Vietnamese brands reach out to the world market.

Meanwhile, at a conference to promote trad
e connection between Vietnamese and Chinese businesses in the fields of agriculture and fisheries, Vietrade Deputy Director Le Hoang Tai said there is ample room for the two countries to further expand economic and trade cooperation in the coming time.

Vietnam’s participation in free trade agrements (FTAs) has helped attract investors from China, as well as businesses that want to take advantage of the FTAs in production and export activities.

Vietnamese Trade Counselor in China Nong Duc Lai said to enhance trade connection between the Vietnamese and Chinese markets, Vietnam’s agricultural and aquatic products must meet increasingly high requirements of China in terms of quality standards, food safety, traceability, and packaging.

The Vietnamese business community should focus on opportunities to attract Chinese businesses operating in the field of processed food, thus seeking ways to boost cooperation with Chinese partners and expand market to this Asian country, he said.

Statistics showed that the impor
t-export turnover between the two countries reached 103.92 billion USD in the first eight months of 2023. China was Vietnam’s second largest export market in the period. The two-way trade is predicted to maintain growth momentum and achieve positive results in 2023.

Vietnam Foodexpo 2023, which will last until November 25, features more than 500 booths of nearly 400 domestic and international enterprises, including businesses from 30 Vietnamese cities and provinces and more than 20 countries and territories such as the US, Russia, Australia, China, the Republic of Korea, Japan.

On display are a wide range of agricultural products, aquatic products, processed foodstuff and beverages, as well as food processing, preservation and packaging technologies and equipment, among others./.

Source: Vietnam News Agency

Vietnamese airlines have enjoyed better business results on the back of the tourism sector’s strong recovery. However, high oil prices and fierce competition from foreign competitors are among the grave concerns for domestic carriers.

Revenue jumps, loss narrows

According to the General Statistics Office of Vietnam and the Vietnam National Authority of Tourism, Vietnam welcomed 8.9 million foreign arrivals during January – September, up 4.75 folds from the same time last year. Of the total, more than 6.1 million came to the country by air, increasing 3.7 folds year-on-year.

With the tourism sector bouncing back, domestic airlines have enjoyed robust business results.

The consolidated financial report from the Vietnam Airlines Joint Stock Company (Vietnam Airlines) showed that the airline’s turnover in Quarter 3 rose 11.7% year-on-year to more than 23.75 trillion VND (981.6 million USD), marking an eight-quarter streak of recovery.

During January-September, the company gained nearly 68.1 trillion VND in
revenue, rising 32.5% year-on-year. Meanwhile, it ran at a loss of more than 3.5 trillion VND, which was half of the figure recorded in the same time last year.

The Vietnam Airlines Group, which comprises national flag carrier Vietnam Airlines, Pacific Airlines, and Vasco, operated over 114,000 flights, and transported more than 18 million passengers during the period, according to the Civil Aviation Authority of Vietnam (CAAV).

Although Vietjet Air reported a surge of 25% in its revenue in Quarter 3, it is taking on formidable challenges.

Meanwhile, Bamboo Airways continued to adjust its flights for the year-end period with the suspension of various international flights from Hanoi and Ho Chi Minh City to overcome the rough times.

Airlines need support to improve competitive edge

Despite strong recovery, domestic airlines has yet to reel in profits as airfares could not outpace expenditures.

the Vietnam Airlines Group’s domestic tickets in June fell 6.6% as compared to the same month of 2019 – before t
he COVID-19 pandemic broke out.

The ceiling for airfares has been kept unchanged since 2015 while input costs such as fuels and exchange rates have fluctuated, leaving a negative impact on airline business results, Vietnam Airlines said.

Vietnam Airlines spending on fuels last year surged 30.5% from 2015 – the time when the ceiling airfares were applied since average fuel prices rose 85% to 124.46 USD per barrel in 2022 from 67.37 USD in 2015.

‘Airline carriers incur 70% of costs in foreign currencies. Ticket revenue is in VND, JPY and KRW, which are all falling against USD. Therefore, currency fluctuation risk has affected their business performance. The USD/VND rate rose 6.6% from 21,900 VND in 2015 to 23,350 VND 2022, causing Vietnam Airlines spending to increase 4.35%’, a representative from the national flag carrier said.

According to insiders, the aviation sector needs support from the Government, relevant ministries and sectors, as well as the supply chain of both tourism and aviation sectors so as
to carve out better performance.

In the long term, experts said it is necessary to lift the airfare cap, which have been placed on domestic routes, to help airlines improve revenue and profits. However, the removal requires the amendment of the law on civil aviation and the law on prices that could take a long time. Bottlenecks should be removed soon so that airlines could survive until the end of 2024 when the market is on full recovery.

Vietnam Airlines proposed extending airfare caps in short term, creating favourable conditions for airlines to improve capacity and competitive edge.

It suggested imposing floor prices for domestic tickets based on the operation model of each airline to create a sustainable competitive environment for airlines, and ensure rights and benefits for passengers./.

Source: Vietnam News Agency

A workshop spotlighting Canada as a gateway for Vietnamese businesses to access the North American market took place in Ho Chi Minh City on November 22, aiming to provide the latest information, consumer trends, and export incentive policies for Vietnamese businesses to deepen their participation in the Canadian market.

Canada is Vietnam’s second-largest trading partner in the Americas after the US. According to data from the General Department of Vietnam Customs, trade between Vietnam and Canada reached over 5.2 billion USD in the first 10 months of 2023, down 16.3% year-on-year.

Addressing the event, co-organised by the Ho Chi Minh City Investment and Trade Promotion Centre (ITPC) and Vietnamese Canadian Business Association (VCBA), Vice Chairman of the HCM City People’s Committee Vo Van Hoan said that the figure is modest compared to the potential boasted by the two countries. Vietnam also plays a role as a gateway for Canada to Southeast Asia and the Asia-Pacific region, he noted.

Consul General of Vi
etnam in Canada’s Vancouver Nguyen Quang Trung said that despite their geographical distance, the sides’ bilateral cooperation has developed strongly and comprehensively across various sectors. Both are members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and are currently initiating negotiations for the ASEAN-Canada Free Trade Agreement this year.

According to the diplomat, Vietnam and Canada have significant potential to expand multi-sectoral collaboration from trade to investment. Canadian investors are particularly interested in such areas as education, infrastructure, financial investment, and clean energy in Vietnam.

Pham Hong Hai, Vice Chairman of the Thien Viet securities company and former national director for HSBC Canada, stressed that establishing a business presence in Canada helps Vietnamese enterprises access the market and achieve a larger goal of developing global export markets and promoting their brand internationally.

In particular, businesses loo
king to access the US market should prioritise opening branches or offices in Canada, as selling products through Canada to the US is considered an export activity and can receive various forms of support.

Hai also listed several sectors with great potential for Vietnamese firms in Canada, including import-export, investment, commercial and industrial real estate, agriculture and farming, food processing, beverages, construction, as well as healthcare and pharmaceuticals./.

Source: Vietnam News Agency