VIETNAM BUSINESS NEWS NOVEMBER 20

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Manufacturing chip-semiconductor helps raise Vietnam’s position hinh anh 1

Vietnam is asserting its position in the chip supply chain amid the global chip shortage and the fierce competition among major countries in terms of manufacturing chip-semiconductor and developing microchip industry, according to Sputnik Radio.

In a broadcast on November 16, the radio cited an article written by Le Phan and Nguyen Hai Thanh, two economists from the Central Institute for Economic Management (CIEM) posted on East Asia Forum on Vietnam’s progress in the global supply chain.

Samsung, the world’s leading supplier of DRAM products, will spend 850 million USD in Vietnam to manufacture flip-chip ball grid arrays (FC-BGA).

The electronics giant also plans to inaugurate a Research and Development Center in Hanoi by the end of 2022 and early 2023, serving not only Vietnam but also Southeast Asia. According to the CIEM economists, the investment will make Vietnam one of only four countries – alongside the Republic of Korea, China and the United States – that produce semiconductors for the world’s largest memory chipmaker.

“Vietnam’s selection over more developed locations speaks volumes about the country’s rising importance in the semiconductor value chain,” they wrote.

Sputnik Radio noted that Vietnam is not a newcomer to the semiconductor industry. The country’s first semiconductor plant, Z181, was established in 1979 to produce and export semiconductor components to the former Eastern European countries.

Vietnam’s industrial and technology policies have always granted the highest incentives for high-tech projects, including corporate income tax reduction and sales tax and land rent exemption, the two economists noted.

One advantage of Vietnam over its regional neighbours is its pool of young engineering talent at a relatively lower cost.

Over 40% of Vietnamese college and university graduates are majoring in science and engineering, and Vietnam has been among the top 10 countries with the most engineering graduates, according to the economists.

Digital transformation an urgent need for SMEs

Digital transformation has been seen as an urgent need to help link small and medium-sized enterprises (SMEs) with global trends.

According to the Ministry of Planning and Investment, Vietnam has approximately 900,000 operational businesses. More than 97% are SMEs that contribute up to 45% of the national GDP and 31% of the total budget collection. Together, these companies employ over 5 million labourers.

Vietnam is set to post a 31% growth in gross merchandise value (GMV) from 23 billion USD in 2022 to 49 billion USD in 2025, according to the “e-Conomy SEA 2022” report released by Google, Temasek and Bain & Company on October 27.

The report said South East Asia’s top digital economies grew faster than expected in 2022 and is set to reach 200 billion USD in total value of transactions made this year.

The six major economies covered in the report, namely Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, will achieve the milestone of 200 billion USD by 2025 which is three years earlier than schedule.

Recent research by Meta unveils that 73% of Vietnamese consumers surveyed use Business Messaging to reach out to brands, the highest rate among the nations included in the research.

The figures reflect the readiness of Vietnamese businesses and consumers to engage in the digital economy, as well as the dynamism and efforts of the domestic firms.

Meta commits to supporting Vietnamese SMEs to increase their presence at online platforms and benefit from the digital economy, said Ruici Tio, Policy Programme Manager of Meta Asia Pacific.

Through its long-term partnership with the Vietnam Chamber of Commerce and Industry (VCCI), Meta has provided support for more than 32,000 SMEs nationwide, he noted.

Meta has also launched an e-handbook introducing enterprises on digital platforms, he added.

This is the sixth year the SME Support Centre under the VCCI has cooperated with Meta to roll out the Meta Boost programme. This has benefited some tens of thousands of SMEs nationwide, both online and in-person, through diverse activities like forums and training courses.

VCCI Vice Chairman Bui Trung Nghia said his chamber has coordinated with Meta to organise an array of activities aiming to raise the awareness of Vietnamese businesses to equip them with digital skills.

VCCI has released a e-handbook introducing 100 SMEs providing their information to both customers and businesses seeking potential partners. It plans to introduce the e-handbook to 500,000 domestic and foreign partners through its network, he said.

Thailand to host Thailand-Vietnam-Laos Business Forum

The Thailand-Vietnam-Laos Business Forum 2022 will take place in Udon Thani city of Thailand from November 27 to 29 to enhance trade exchanges and connectivity among businesses from the three countries.

The forum is expected to present a great opportunity for Vietnam to introduce its business climate, encourage Thailand to invest in the country, and promote the export of its goods to the Thai and Lao markets, as well as boosting technology transfer among the regional three countries.

It will also help Vietnamese small and medium-sized enterprises (SMEs) to strengthen linkages with overseas Vietnamese firms, thereby accelerating the introduction of local goods abroad.

The event is anticipated to attract the participation of some 500 Thai, Vietnamese, and Laotian businesses operating in fields such as agriculture, tourism, services, high technology, import-export, and finance.

Experts say there remains plenty of room to further increase bilateral trade and cooperation with Thailand in the fields of energy, logistics, finance, agriculture, and investment.

At present, there are 4.5 million Vietnamese people residing and working abroad, including those in Thailand who have made great contributions to the host country and to the homeland.

Vietnam is Thailand’s second largest trading partner in Southeast Asia. Both countries are two dynamically developing economies in the region that have similarities regarding consumer culture and products and services.

Tourist arrivals to Hanoi records five-fold rise in 11 months

The number of tourists arriving in Hanoi since the beginning of the year is estimated at over 17 million, representing a five-fold increase year on year, according to the Municipal Department of Tourism.

The capital specifically welcomed 1.27 million international arrivals and 15.75 million domestic tourists, respectively, with total tourism revenue expected to hit VND48.35 trillion.

With 1.27 million international arrivals recorded, Hanoi fulfilled the target set for the entire year.

The city is anticipated to serve 1.61 million holidaymakers in November, including 1.35 million locals, and earn roughly VND4.39 trillion from services.

Dang Huong Giang, director of the Hanoi Department of Tourism said the autumn-winter season is widely considered the peak time for Hanoi to welcome visitors, especially international arrivals.

In the remaining weeks of the year, Giang revealed the capital’s tourism industry plans to deploy a range of diverse activities, including an Ao Dai Festival in 2022 and a seminar to connect tourist attractions in Hanoi.

Hanoi will also seek to deploy new types of tourism such as MICE (Meetings, Incentives, Conferences, Exhibitions) tourism, and adventure sports tourism, as well as helicopter, hot air balloon, and virtual reality tours.

Recently, Hanoi was honoured as the “World’s Leading City Break Tourism Destination 2022” at the “World Travel Awards 2022” ceremony.

Provinces eye distribution channels in HCM City

More than 1,000 businesses from 42 cities and provinces are participating in the annual Supply-Demand Connection conference that opened on November 17 in HCM City.

Products and services from localities are being showcased at 500 stalls during the conference held by the HCM City Department of Industry and Trade.

Speaking at the opening ceremony, deputy chairwoman of the city People’s Committee Phan Thi Thang said the programme played a role in connecting producers and distributors and boosting economic growth.

Launched in 2012, the programme has expanded its scale with a sharp rise in provinces and businesses joining in and the number of contracts signed at the event, Thang said.

She asked the city’s Department of Industry and Trade to foster the link-ups with other cities and provinces and facilitate online business.

Bui Ta Hoang Vu, director of the city’s Department of Industry and Trade, said that online platforms would be used to promote link-ups between producers and distributors throughout the year.

Through the programme, businesses in the city can find a stable and abundant supply of goods at reasonable prices for the city’s market stabilisation programme, Vu said.

It helps provinces find regular distribution channels for their products, he said.

Customers in the city can also buy high-quality specialty products during the event.

The event at Phu Tho Indoor Sport Stadium runs until November 20.

Mekong Delta needs more tourism products to attract visitors: conference

Tourism companies and operators in the Cuu Long (Mekong Delta) provinces need to be more creative in offering new products and services Ha Van Sieu, deputy head of the Viet Nam National Administration of Tourism, has said.

Speaking at a conference on promoting trade and tourism investment between HCM City and the delta province of Vinh Long, Sieu referred to the extremely rich tourism potential of the delta.

He pointed to the untapped tourism potential of places like the Mang Thit Contimporary Heritage Site with its extremely unique cultural value that could not be found anywhere else.

The site must be developed as a tourism symbol of Vinh Long Province, he said, adding there is also great potential for agriculture tourism in the region, and companies should create new tourism products around them.

Other participants agreed with him that tourism in the delta, Vinh Long in particular, could be further developed since the region is close to HCM City, a tourism hub of the country.

The co-operation between the city and delta provinces like Vinh Long is imporant to exploit the potential of the region, they added.

Lu Quang Ngoi, chairman of Vinh Long Province, said HCM City plays an important part in the socio-economic development strategy of the Southern Key Economic Zone and in fact the entire country as it is a huge consumer market and a gate connecting Viet Nam with regional and global markets.

So co-oepration with the city would provide momentum for delta provinces to develop, he added.

Phan Thi Thang, deputy chairwoman of the city People’s Committee, said co-operation between HCM City and delta provinces including Vinh Long would create conditions for investors to make market development plans and expand production.

In another development, industry businesses groups in Vinh Long and HCM City signed agreements to develop trade and tourism.

The province signed memorandums of understanding with investors totally worth VND5.5 trillion (US$250 million).

Viet Nam reopened to tourism after COVID-19 pandemic and quickly recovered, and is the fastest growing tourism market in the Asia Pacific now.

In the year to date, there have been 91 million domestic tourists. To put this in perspective, the comparable figure in 2019, before COVID-19 began, was 85 million.

There have also been 2.3 million foreign tourists. The country targets five million visitors for the full year.

Market closes the week on a positive note

Shares finished higher on Friday and marked a weekly gain, thanks to bargain-hunting demand from investors after recent losses to nearly 900 points.

On the Ho Chi Minh Stock Exchange (HoSE), the VN-Index steadied in the last trading session of the week after losing 24.7 points, or 2.55 per cent, in the morning trade due to strong selling pressure.

It finished the day at 969.33 points, an increase of 0.07 points, or 0.01 per cent.

The market’s breadth was positive with 233 stocks adding points on the southern bourse, while 104 stocks inched lower.

Liquidity also slightly improved, of which matching value on HoSE rose more than 1 per cent to nearly VND11.52 trillion (US$464.3 million), equal to a matching volume of 834 million shares.

The big correction in the morning session triggered bottom-fishing demand, helping the index to pare the downtrend and rebound in the afternoon trade. It also received support from the VN30 stocks. Accordingly, the 30 biggest stocks tracker on HoSE gained 0.16 points, or 0.02 per cent, to 971.2 points.

Statistics from the financial website vietstock.vn showed that Hoa Phat Group (HPG) contributed the most to the bullish trend, up nearly 6 per cent.

It was followed by Vingroup (VIC), Vietnam Rubber Group (GVR), Vinamilk (VNM) and Eximbank (EIB). These stocks were up at least 1.5 per cent, with EIB and GVR even hitting the maximum daily gain of 7 per cent.

Gains were capped by lingering selling force in some pillar stocks. Of which PV Gas (GAS) was the biggest loser, down 4.51 per cent. The negative performance is likely due to sharp falls in international oil prices as markets worry that the US interest rate policy and rising COVID cases in China might weaken fuel demand.

Many other sticker symbols posted great losses yesterday, such as Novaland (NVL), Becamex (BCM), Sabeco (SAB), Masan Group (MSN), Vietinbank (CTG), Techcombank (TCB), and Vincom Retail (VRE). All fell in a range of 1.1-7 per cent.

The HNX-Index on the Ha Noi Stock Exchange (HNX) also finished the week higher, up 3.01 points, or 1.6 per cent, to 190.87 points.

During the session, more than 108.1 million shares were traded on HNX, worth over VND1 trillion.

Meanwhile, foreign investors were net buyers on the market with a value of VND10.81 billion. Of which, they net sold VND25.09 billion on HoSE, while net bought VND35.9 billion.

S.Korean firm to break ground on clean industrial complex in northern Vietnam

The Korea Land and Housing Corporation (LH) will start work on a clean industrial complex in the northern province of Hung Yen on November 25.

The complex will cover an area of 1,431,000 square meters along the Hanoi-Haiphong Expressway, which links the Vietnamese capital city with Haiphong, the country’s largest port city.

The clean industrial complex will offer one-door services in administration, finance and tax to enterprises operating in the complex.

LH started surveying locations to build the complex in 2017 and finally chose Hung Yen as an appropriate one.

In July last year, the Seoul-based company got the green light from the Vietnamese Government to develop the project.

Two months later, Vietnam Korea Together, a joint venture of Vietnam and South Korea, was established to execute the project.

The construction of the project is slated for completion in September 2024.

Enterprises that seek to rent premises in the complex must be South Korean firms with their headquarters in South Korea. South Korean firms headquartered overseas can also rent premises in the complex, provided they have South Korean shareholders.

LH Corporation will equip the complex with convenient equipment to create favorable conditions for enterprises and employees.

Besides Hung Yen, LH is mulling over a plan to set up more South Korea-style industrial parks in other localities as well as other plans for smart city, social housing, and economic zone development in Vietnam.

Vietnam eyes US$47 billion in apparel exports in 2023

Vietnam’s textile and garment export revenue is expected to hit US$47 billion in 2023, according to the Vietnam Textile and Apparel Association (VITAS).

Speaking at a press briefing on November 18, VITAS Chairman Vu Duc Giang forecast the country would see strong growth in apparel exports next year, despite several challenges related to the workforce, a plunge in orders, soaring interest rates and a volatile exchange rate.

New free trade agreements will boost Vietnam’s apparel exports, said Giang.

In addition, Giang proposed the Government and ministries consider reducing taxes or extending tax payment deadlines for apparel exporters to help them maintain their production and stabilize their workforce, contributing to fulfilling the 2023 export target.

VITAS also proposed banks offer preferential loans to major apparel exporters to stimulate them to ramp up production and shipment.

The country exported textiles and garments worth some US$38 billion to 66 countries and territories between January and October, up 17.2% year-on-year, making the target of US$43 billion in apparel exports achievable this year.

MoIT orders clarifying quality of Gau Do instant noodle batch exported to Taiwan

The Ministry of Industry and Trade has recently issued a document saying that the Gau Do (Red Bear) instant noodles of Asia Foods Corporation were found by Taiwanese authorities to have inappropriate Ethylene Oxide content.

Specifically, when inspecting a shipment of 500 CTN (945kg) of Gau Do instant noodles at the border gate imported by Qian Foods Enterprise Co., Ltd., the Taiwan Food and Drug Administration (TFDA) detected Ethylene Oxide content at 3,438mg per kg in the seasoning package and 0.107mg per kg in the noodles.

After receiving the notice, the Ministry of Industry and Trade requested Asia Foods Corporation to urgently report information on quantity, production batch, expiry date, export market, and a copy of self-declared documents of food with test results produced and sold by this company in Vietnam and exported to Taiwan market in 2022, as well as the company’s instant noodle production technology process.

Hanoi’s tourism sector exceeds 2022 target

Hanoi is expected to welcome over 17 million visitors by the end of November, far exceeding the full-year target of 9-10 million, according to the capital city’s tourism department.

In November alone, Hanoi is expected to welcome 1.61 million visitors, including 255,000 foreign tourists, generating a revenue of 4.39 trillion VND (177 million USD).

For the January-November period, the capital city welcomed an estimated 17.02 million tourists, with revenue at 48.35 trillion VND (1.95 billion USD).

In its tourism recovery and development plan for 2022, Hanoi set a target to welcome 9-10 million visitors, including 1.2-2 million foreign visitors, but the latest figures show that such a target has already been surpassed.

In November, the room occupancy rate of hotels in Hanoi is estimated at 47%, up 3.2 percentage points from October and 20.4 percentage points from a year earlier.

The rate for the January-November period is 36.1%, up 14.7% over the same period last year.

To continue attracting domestic and foreign tourists to the capital city, the municipal tourism department is planning to roll out a variety of new tourism products such as MICE tourism, adventure sports, Red River tours, and helicopter and hot-air balloon tours.

PM chairs conference on Central Highlands development

Prime Minister Pham Minh Chinh on November 20 chaired a conference that examines the Government’s action programme to realize the Politburo’s resolution on socio-economic development and defense-security in the Central Highlands till 2030 with vision to 2045.

The Central Highlands which comprises Dak Lak, Dak Nong, Gia Lai, Kon Tum and Lam Dong provinces is a particularly important strategic area in terms of economy, politics, security, defense and ecological environment of Vietnam. The stability and sustainable development of the region located in the Laos – Vietnam – Cambodia Development Triangle area play a very important role in the country’s economic growth and development.

In October 2022 the Political Bureau issued Resolution 23 on socio-economic development orientations and defence-security in the Central Highlands till 2030 with vision to 2045.

Under the resolution, by 2030 the Central Highlands strives to become a fast and sustainable development region based on a green and circular economy, and a unique attractive destination for both domestic and international visitors. By 2045 it will be turned into a region of sustainable development on the back of a green and circular economy, and some of its localities in the region will belong to the well-developed group of localities in the country.

The Government shortly issued an action programme with numerous targets set to realize the resolution. Notably, the region’s average Gross Regional Domestic Product (SRDP) is projected to expand 7-7.5% in the 2021-2030 period, with GRDP per capita to rise to about VND130 million by 2030.

Over EUR7 million to aid delta farmers’ green production

The German-funded Green Innovation Centres for the Agriculture and Food Sector (GIC) project worth over EUR7 million is underway in Mekong Delta localities.

Co-implemented by German development agency GIZ and the Department of Cooperatives and Rural Development, the project aims to promote the introduction and replication of innovative models and solutions through various agricultural products in contribution to sustainable rural development.

Accordingly, a series of goals have been set, including helping farmers reduce 40% of water use, 25% chemical use, 40% of greenhouse gas emissions, and 60 of pesticides.

Beneficiaries are the provinces of An Giang, Kien Giang, Hau Giang, Dong Thap, Soc Trang, and Can Tho city.

Kamila Tovbaeva, Coordinator of the Component Coordinator of Capacity Building for Cooperatives and Farmers under GFA Consulting Company, said the GFA will provide assistance to 90 cooperatives in the Green Innovation Project located in six delta localities as well as business training for nearly 8,000 farmers until 2023.

In An Giang, the GFA is in charge of capacity building for 17 local agricultural cooperatives and business training for farmers. These components primarily focus on boosting skills in cooperative management, production and business planning, financial management, marketing and market management.

Earmarked to implement the project for the local cultivation of rice and mango from 2021 to 2025, An Giang expects to improve farming efficiency and quality and gradually develop a sustainable value chain.