Prime Minister Pham Minh Chinh has urged ministries and agencies to regulate cryptocurrency-based transactions due to potential legal risks.
According to the prime minister, although the country has no specific requirements on the use of cryptocurrencies, many transactions have been carried out using digital money in the market.
PM Chinh underlined the importance of issuing regulations on the use of crypto in Vietnam as part of efforts to develop the anti-money laundering law.
He said the National Assembly (NA) should assign the task to the Government.
Previously, NA deputies proposed adding cryptocurrency and virtual assets to the draft of the anti-money laundering law. They raised concerns about risks regarding illegal activity through crypto transactions.
Exports of Vietnam’s key items slump in September
September saw a drastic decline in Vietnam’s exports of several key items, according to data from the General Administration of Vietnam Customs.
Among the most affected were garments and textiles, whose exports in September dropped 31.9% over the previous month at US$2.72 billion.
Millwork exports declined 21% against August at US$1.11 billion while steel exports edged down 6.2% at US$429 million.
Goods produced by foreign-invested businesses or with great export value are getting the same fate.
Exports of mobile phones and components brought in US$5 billion, a drop of 18.1% over last month, while that of machinery and equipment plunged 7.7% at US$4.15 billion.
According to the customs agency, the export value in September slid 14.6% over August and generated US$29.82 billion.
Businesses attributed the situation to global economic uncertainties and runaway inflation, which has hit consumption. Things will not improve until the end of the first quarter of next year.
However, Vietnam maintained a high export value in the first nine months of this year. Exports rose by 17.2% to US$282.35 billion, while imports rose by 12.8% to US$275.58 billion, resulting in a trade surplus of US$6.76 billion.
Customs data showed that Vietnam’s total exports in the first three quarters of this year amounted to US$557.93 billion, up 15% year-over-year.
Sugar imports from five Southeast Asian countries plunge
Sugar imports from Cambodia, Indonesia, Laos, Malaysia and Myanmar have declined since Vietnam took measures against trade remedy circumvention.
On August 1, the Ministry of Industry and Trade issued Decision 1514/QD-BCT imposing measures against trade remedy circumvention of the sugar imports from the five Southeast Asian countries.
Under the decision, Vietnam imposes antidumping and countervailing duties of 47.64% on sugar imports from the five countries if the sugar contains Thailand’s cane sugar.
The decision caused a plunge in sugar imports from the five countries, acting general secretary of the Vietnam Sugarcane and Sugar Association Nguyen Van Loc told The Saigon Times.
In September, Vietnam only imported under 40,000 tons of sugar from them, the lowest since early this year, a source told The Saigon Times.
According to the source, Vietnam imported 60,000 tons of sugar in August and nearly 100,000 tons in January and March from the countries.
Data from the Ministry of Industry and Trade showed that only six exporters from Laos, Indonesia and Myanmar did not circumvent the antidumping and countervailing duties, meaning they did not use Thai cane sugar for their products. Thus, they are entitled to a 5% tariff under the ASEAN Trade in Goods Agreement.
Over 88 percent of credit institutions expect positive growth in pre-tax profit
According to the survey on business trends of credit institutions conducted by the State Bank of Viet Nam, more than 88 percent of credit institutions expected their pre-tax profit this year to grow positively compared to the previous year.
Credit institutions said that the banking system has well maintained liquidity in both VND and foreign currencies.
They expected that by the end of 2022, the bad debt ratio and credit balance could stay significantly lower than that at the end of last year. Previously, consecutive impressive growth numbers were announced by banks after nine months in 2022.
Most recently, Asia Commercial Joint Stock Bank (ACB) said that it had completed more than 90 percent of the whole-year plan with a consolidated pre-tax profit of VND13,500 billion, an increase of more than 50 percent over the same period.
According to Viet Nam Import-Export Commercial Joint Stock Bank (Eximbank), the bank’s 9-month pre-tax profit reached nearly VND3,200 billion, while the same period last year announced the figure of only VND966 billion.
Meanwhile, at Viet Nam Thuong Tin Commercial Joint Stock Bank (Vietbank), the 9-month accumulated pre-tax profit also increased sharply by 36 percent compared to the same period last year, reaching VND536 billion.
The most impressive is Saigon – Ha Noi Commercial Joint Stock Bank (SHB), with a growth of 79 percent over the same period in 2021, reaching more than VND 9,035 billion in pre-tax profit after nine months.
Textile and garment sector bears the brunt of global uncertainties
Textile and garment businesses are facing pressure due to weaker purchasing power caused by mounting inflation and other global uncertainties.
Sharp export declines were recorded in the US, Europe, Japan, the Republic of Korea (RoK), and China, according to the General Statistics Office.
Textile and garment exports in September dropped by nearly US$1.2 billion, or 27 per cent, from the previous month, to $3.2 billion.
According to the SSI Securities Corporation the number of orders placed for the fourth quarter of 2022 fell by 25-50 per cent from the second quarter, when orders increased strongly, because the unsold inventory in import markets is high at present.
Aside from inflation, fluctuations in material prices are also a problem. Le Tien Truong, Chairman of the Viet Nam National Textile and Garment Group (Vinatex), said there were uncertainties running up to the end of the year, especially the Russia-Ukraine conflict and material price fluctuations.
Another challenge is foreign exchange rates, according to analysts. Nguyen Duc Hao, a specialist from the VNDirect Securities Corporation, said the euro had continually depreciated as a result of recession concerns due to Russia’s threat to reduce gas supplies for many European countries, adding that businesses could suffer from lower profits and even losses.
Tuna exports to gross US$1 billion this year
With tuna exports surging by 55% to nearly US$808 million during the past nine months of the year, the tuna industry is anticipated to rake in US$1 billion this year, according to figures compiled by the Vietnam Association of Seafood Exporters and Producers (VASEP).
Expert Nguyen Ha of the VASEP revealed that the United States continues to be Vietnam’s largest tuna export market, with turnover in September edging up 33% to reach over US$31 million against the same period from last year.
Most notably, tuna exports to member countries of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) throughout the reviewed period soared by 95% to nearly US$11 million, while exports to Europe also grossed nearly US$18 million over the past nine months, up 64% on-year.
In line with these figures, Vietnamese tuna exports to EU markets such as Belgium and Germany in September saw sharp annual rises of 199% and 48%, respectively.
During the nine-month period, the country’s top six largest tuna export markets included the US with turnover of US$405 million, Canada with US$43 million, Japan with US$31 million, Israel with US$26 million, Saudi Arabia with US$23, and Thailand with US$20 million.
Vietnam likely to yield US$10 trade surplus this year
Vietnam is likely to produce a trade surplus of US$10 billion this year despite enduring global market uncertainties and fluctuations, Minister of Trade and Industry Nguyen Hong Dien told the ongoing year-end session of the National Assembly.
As of October 21, the country’s trade surplus hit a record high of roughly US$8 billion, and the figure is likely to rise to US$10 billion by the end of the year, Minister Dien said on October 22.
As of October 20 this year the country’s total foreign trade turnover stood at an estimated US$620 billion, and the figure is likely to climb to US$800 billion by the end of the year, with the trade surplus set to rise to US$10 billion.
This is certainly a huge, outstanding, and spectacular achievement, stressed the Minister.
He said that export businesses no longer rely on key markets but have branched out to new ones. Decreasing demand coupled with high inflation in major markets such as China, Europe, Japan, and the United States have forced local businesses to return to the Eastern European market.
Furthermore, the effective application of e-commerce services has enabled Vietnamese commodities to reach more overseas markets. Currently, the country’s e-commerce sales have fetched approximately US$14 billion, with the figure anticipated to rise to up to US$18 billion for the whole of the year.
Waterway transportation agreement benefits Vietnam, Cambodia
A waterway transportation agreement between Vietnam and Cambodia that came into effect in 2011 has facilitated the passage of nearly 78,000 vessels and more than 406,000 sailors.
Some 20 million tonnes of cargo and 1.3 million passengers have been transported via the Vietnam-Cambodia waterway routes, contributing to socio-economic and cultural development in each country and the bilateral friendship, according to the Vietnam Inland Waterways Administration.
The volume of containers on the routes has increased by 20% each year to reach nearly 350,000 TEUS in 2021, and is expected to hit about 400,000 TEUS this year.
Transportation services have generated jobs and brought about 60 million USD to businesses operating on those waterway routes each year.
As of October, around 100 enterprises, organisations and individuals had been operating waterway routes between Vietnam and Cambodia, including big firms with representative offices in Cambodia like SNP, Gemadept, GLS and Tan Cang Cypress.
Deputy PM checks public investment disbursement at tourism ministry
A working delegation led by Deputy Prime Minister Vu Duc Dam on October 25 conducted an on-site check on the progress of the National Library of Vietnam upgrade project and inspected the 2022 public investment disbursement at the Ministry of Culture, Sports and Tourism.
The first phase of the renovation and upgrade project was approved in 2018 and got off the ground in 2019, with a total cost of VND92 billion. Until now, the project is over 90% complete, while the disbursement has reached some 70% of the total required investment, according to the ministry. The first phase of the project will be completed in late 2022.
The ministry attributed the slow disbursement of the project to the impact of the Covid pandemic but said that from late October onward, there would be no obstacles and difficulties facing the project. Work on the second phase of the project will begin in the 2026-2030 period.
As of October 24, the ministry had disbursed over VND290 billion of the total VND1.18 trillion allocated, reaching 17.7% of the target. The ministry is set to disburse more than VND660 billion by the end of January next year, meeting over 55.7% of the target. As its disbursement lagged behind schedule, the ministry plans to lower its target and transfer over VND496 billion of the public capital to other ministries.
Craft fair promoting OCOP products to take place in November
The 18th OCOP Vietnam Craft Village and Products Fair will be held at the Economic Transaction and Commercial Area in Hanoi from November 2 to 6.
Featuring 150 booths, the fair will showcase agricultural, forestry and aquatic products that meet three-star ratings and above from cities and provinces nationwide such as Dien Bien rice, Hai Duong green bean cake, and Tan Cuong tea.
Handicrafts will also be displayed at the fair including Nha Xa silk from Hanoi’s Thanh Tri district, and Bo Bat pottery from Ninh Binh province.
Looking through weaknesses to attract EU capital flows: report
The European Union-Vietnam Free Trade Agreement (EVFTA) and the European-Vietnam Investment Protection Agreement (EVIPA) have helped the country attract foreign direct investment (FDI) from EU member states.
However, the treaties also posed many challenges in luring capital from EU businesses, especially amid the uncertainties of the COVID-19 pandemic, as well as geopolitical and economic instability, in general, and the EU economy, in particular, a report showed.
Since 2010, EU enterprises have increased their investment in Viet Nam despite the fact that the United Kingdom (UK) left the bloc.
In general, the number of EU partners investing in Viet Nam tends to increase over the years. Especially in 2020, 26 out of 27 countries in this bloc registered to invest in the country. By August, the EU had a total of 2,378 valid projects in Viet Nam, worth US$27.59 billion, according to a report released on Tuesday at the workshop on “FDI flows from the EU to Viet Nam in the context of EVFTA and EVIPA”.
Recently, EU businesses have been interested in service industries, clean energy, supporting industries, food processing, high-tech agriculture, and pharmaceuticals.
According to the report, the EVFTA and EVIPA have raised the scale of FDI from EU member countries and FDI in general due to commitments on tariff reductions and creating competitive advantages for the countries in attracting the EU’s FDI.
The main competitors in the region in terms of trade and investment do not have FTAs with the EU. Singapore is the only country in ASEAN that has signed an FTA with the EU.
However, this advantage may be short-term, as the orientation of both ASEAN and the EU is to sign an FTA between the two regions.
The agreements also contribute to the reorganisation of the EU’s investment in Viet Nam by sectors and assist in creating a favourable environment through changes to the institutional and legislative framework.
Nevertheless, these agreements are just one of many conditions required to get EU managers’ attention. The risks of the new context are likely to weaken the business sentiment of global entrepreneurs in general and EU investors in particular.
The digital transformation process may also narrow the EU’s investment flows into Viet Nam, especially those investing in high-value sectors, due to the change in investment objectives of multinational enterprises.
Besides, the EU’s FDI comes with high corporate social responsibility standards in protecting and training workers as well as respecting and protecting the environment. Therefore, the implementation of EVIPA requires continuously improving the competitiveness of the Vietnamese economy and its readiness to take advantage of opportunities from the agreement.
And due to resource limitations, Viet Nam risks becoming a destination for low-quality FDI projects, the report pointed out.
At the event, Nguyen Chien Thang, director of the Institute of European Studies, said that the pandemic was also a cause for the reduction in EU capital flows as some countries pursued the near-sourcing approach, bringing manufacturing facilities back to their countries.
Outstanding Nordic enterprises in Viet Nam honoured
Outstanding Nordic enterprises in Viet Nam will be honoured at an award ceremony in HCM City on October 28, the Nordic Chamber of Commerce in Viet Nam (NordCham) has announced.
Themed ‘Nordic Lights’, the second Nordic Business Awards will recognise Nordic enterprises in Viet Nam in six categories including ‘Green Business of the Year’, ‘Best Sustainable Business Initiative (SME)’, ‘Best Talent Development Strategy’, ‘Most Innovative Project’, ‘Work the Nordic Way (Diversity & Inclusion)’, and ‘Nordic Growth’.
The winners of each award will be announced at the event and the winners of the first four awards will also go through to the finals of the European Chamber of Commerce in Viet Nam (EuroCham) business awards on November 29, according to NordCham.
NordCham is a not-for-profit, non-political, non-governmental organisation representing more than 140 members including the world-renowned companies and investors from Denmark, Norway, Sweden, Finland, and Iceland. Established in Viet Nam since 2016, NordCham supports trade and investment between Viet Nam and Nordic countries and provides a platform for companies to discuss common commercial interests.
36 Danish groups seek investment opportunities in Vietnam
A delegation of 36 Danish investors will visit Vietnam to look for partners and investment opportunities in renewable energy, especially offshore power early next month.
This delegation is part of a side event of the foreign trip of the Danish Crown Couple, Prince Frederik and Princess Mary to Vietnam on November 1-3 to celebrate the 50th founding anniversary of Danish-Vietnamese diplomatic relations and promote green solutions.
The Crown Prince and Princess and the accompanying Danish delegation will meet with leaders of the Vietnamese government, as well as local enterprises. Wind energy and energy efficiency will be the focus of their visit, with the agenda including debates on green transition and visits to local energy projects.
The two parties will organise a series of events to create opportunities for enterprises and investors to look for cooperation and investment opportunities under the umbrella of a Denmark – Vietnam Sustainable Energy Summit themed, and a conference themed “Exploring the role of Danish know-how and technology in building a wind industry in Vietnam.”
There will also be a conference to discuss how to improve energy efficiency in the industry towards a net zero emissions target by 2050.
On the second day of the business trip, Prince Frederik will lead a delegation to visit Haiphong to participate in an investment promotion event. Meanwhile, Princess Mary will lead a group to visit Ha Nam province.
Loc Troi gets US$100 million loan to produce quality rice
Loc Troi Group, or LTG, has signed a syndicated credit agreement with seven local and foreign banks with a credit line of up to US$100 million, helping supplement its working capital for investment in high-quality rice production.
The syndicated loan will be executed in three years and disbursed in the form of LTG granting rice seeds, agriculture materials and agricultural services to cooperative alliances, cooperatives, cooperative groups and farmers affiliated with LTG.
The disbursement will be done in line with the cropping calendar and digitalized via tech apps with a simplified interface that enables farmers to easily follow up with the production schedule during the cultivation period.
According to a statement of LTG, the seven lender banks are MB Bank, Kasikornbank, First Commercial Bank, Agricultural Bank of China Limited – Branch in Hanoi City, China Construction Bank Corporation – Branch in HCMC, CTBC Bank Co., Ltd. and E.SUN Commercial Bank, Ltd. – Branch in Dong Nai Province.
Can Gio int’l container terminal planned to supplement Cai Mep-Thi Vai
A port project in HCMC’s outlying district of Can Gio will serve international shipping and transit demand, enhancing the operational effectiveness of the Cai Mep-Thi Vai port, according to Phan Van Mai, chairman of HCMC.
Mai stated that the Can Gio international container terminal project is expected to take advantage of Can Gio District and maximize the handling capability of regional cluster ports.
The local media reported that Can Gio has favorable conditions for developing a port system and international container transshipment services due to its water depth and little waves’ height and wind speed influence.
Some 80% of the project operation will focus on international shipping services, according to the Mediterranean Shipping Company with its subsidiary Terminal Investment Limited, the project’s investor.
According to Mai, the project will increase the competitiveness of Vietnam and the Southeastern region, which will help draw more foreign direct investment inflows.
The Can Gio international container terminal project has a total investment of US$5.9 billion, funded mainly by local and foreign investors. It is expected to handle vessels with 250,000 DWT.
Binh Phuoc’s 34 infrastructure projects require VND16.6 trillion
The southern province of Binh Phuoc will need roughly VND16.6 trillion to implement 34 traffic infrastructure projects by 2025 to upgrade its transportation system, according to a scheme recently passed by the province’s chairman, Tran Hue Tien.
During the 2021-2025 period, Binh Phuoc will cooperate with relevant ministries, agencies and localities to implement key inter-regional projects, such as the HCMC-Thu Dau Mot-Chon Thanh expressway, two road sections linking its Chon Thanh District with Dak Nong and Long An provinces under the big-ticket North-South expressway project.
This is in addition to a road connecting the province with the under-construction Long Thanh International Airport in Dong Nai Province and the Cai Mep-Thi Vai Terminal in Ba Ria-Vung Tau Province.
It also prioritizes the construction of roads linking Dong Xoai City, Chon Thanh Town and Dong Phu District, considered the drivers of local economic growth, and roads connecting urban areas in Dong Xoai City, Binh Long and Phuoc Long towns.
Fundiin raises $5 million investment in Series A round
Buy now pay later (BNPL) fintech Fundiin has successfully raised $5 million in a Series A funding round co-led by Trihill Capital and ThinkZone Ventures. The new round of funding will help Fundiin to expand at a faster pace and expand to Indonesia in the upcoming series B round.
With the deal, Fundiin will be able to strengthen its position in Vietnam. It will also contribute to developing new products and attracting top talents before expanding to Indonesia in the upcoming series B round.
Nguyen Anh Cuong, CEO and co-founder of Fundiin, said that credit card penetration rate in Vietnam was only 5 per cent; therefore there was strong potential market for BNPL to develop. He added that BNPL was also an important solution to promote financial inclusion and prevent loan sharks.
Vietnam exports first batch of processed chicken to Japan
CPV Food Co., Ltd., a subsidiary of the CP Vietnam Corporation, announced on October 25 that it successfully shipped its first batch of processed chicken weighing over 33 tonnes to Japan.
The shipment demonstrates CPV Food’s great efforts in penetrating the demanding market that imports approximately one million tonnes of chicken meat a year, ranking third in the world after China and Russia.
The move opened up a big opportunity for CPV Food in particular and the poultry industry in general to penetrate deep into the Japanese market, said Deputy Minister of Agriculture and Rural Development Phung Duc Tien, at the announcement ceremony.
Taiwanese firm to invest US$30 million in factory building scheme
TES Touch Embedded Solutions (Xiamen) Co.,Ltd of Taiwan (China) are keen to move its the production plant from India to Vietnam, with estimated investment capital in the initial phase reaching approximately US$30 million.
This information was unveiled during a meeting held on October 25 between Vuong Quoc Tuan, vice chairman of the Bac Ninh provincial People’s Committee, and representatives of TES Touch Embedded Solutions (Xiamen) Co.,Ltd. The primary purpose of these discussions was to explore investment opportunities in industrial zones throughout the northern province of Bac Ninh.
The province boasts a total of 16 industrial zones, attracting several significant projects from 39 countries and territories investing in 16 industries and fields, with a total investment capital of roughly US$23 billion.
Of the figure, Taiwan (China) has 55 investment projects capitalised at some US$600 million in Bac Ninh, with typical Taiwanese investors including Foxconn, Fushan, and Sunfar.
Vietnam accelerates agricultural exports in final months of 2022
Vietnam’s agricultural sector is utilising all resources to accelerate export activities in the fourth quarter by focusing on deep processing, high quality and key markets in order to realise the full-year export target of 55 billion USD.
Data released by the Ministry of Agriculture and Rural Development (MARD) shows that Vietnam exported 40.8 billion USD worth of farming produce in the first nine months of 2022, up 15.2% year on year. The seven commodities with revenue exceeding 2 billion USD were seafood, coffee, rice, rubber, fruits and vegetables, cashew nuts, and timber and timber products.
According to VASEP, which represents seafood producers and exporters, Vietnam’s seafood exports hit 8.5 billion USD by the end of the third quarter, up 38% over the same period last year; of which shrimp exports brought in nearly 3.4 billion USD, up 23%, while shark catfish exports generated almost 2 billion USD, up 82%.
Regarding the market, seafood exports to the EU already surpassed 1 billion USD in the first nine months, up 41%. The US remained the largest market for Vietnamese seafood at 1.8 billion USD, up 22%, while China witnessed the strongest growth at 76%, reaching 1.35 billion USD. It is anticipated that Vietnamese seafood exports will reach 10 billion USD by the end of November.
For fruits and vegetables, the nine-month revenue dropped 11% to 2.45 billion USD as exports to China fell by a sharp 30.5% from the same period last year to about 1.06 billion USD. As such, the sector is racing against time to fulfil the target of 3.2 billion USD for 2022.
According to Secretary General of the Vietnam Fruit and Vegetable Association Dang Phuc Nguyen, it is good news that the first batches of Vietnamese durian have been exported to China via official channels following an agreement between MARD and China’s customs agency.
One of the goods that is expected to see strong growth during the year-end months is rice. In the first nine months of 2022, rice export revenue reached 2.6 billion USD, up 9.3% year on year. Vietnam is seeking to export 6.3-6.5 tonnes of rice in 2022, with revenue expected to reach 3.2-3.3 billion USD.
According to VASEP Secretary General Truong Dinh Hoe, the seafood sector was expecting explosive growth in the final months of the year to meet the increased demand for the holidays. But with many countries facing high inflation, resulting in low purchasing power, the sector will shift to more affordable processed products to boost demand.
For fruits, Vietnam is enjoying a great advantage in demanding markets, so enterprises should strive to meet the quality and food safety requirements for greater market penetration. The US market, for example, has a huge demand for fruit, reaching as much as 12 million tonnes a year, said Nguyen Thi Thu Thuy at the Vietnam Trade Promotion Agency.
Currently Vietnam’s agricultural sector is gearing up to fulfil the target for 2022. With solid performance in the first nine months of the year, if Vietnamese enterprises manage to “catch the market signals” successfully, the agricultural sector’s export target of 55 billion USD for 2022 is entirely within reach.
VIETNAM BUSINESS NEWS OCTOBER 26 – VietNamNet
Prime Minister Pham Minh Chinh has urged ministries and agencies to regulate cryptocurrency-based transactions due to potential legal risks.