VIETNAM BUSINESS NEWS APRIL 8/2023

In contrast to bleak financial prospects in the January-March period, reflected in the city’s gross regional domestic product expansion of a mere 0.7%, the financial picture may become bright in the year’s second quarter.

Citing data from the HCMC Statistics Office survey, Bui Ta Hoang Vu, director of the HCMC Department of Industry and Trade, said only 18.6% of respondents predicted that business conditions would improve in the first quarter of 2023, compared to 37.4% who held this belief in the second quarter. He was speaking during a press conference held yesterday, April 3.

Local manufacturers were grappling with difficulties caused by fewer new orders, rising input costs and the adaptation of tight monetary policy to combat inflation, and face the prospect of an economic slowdown, leading to a drop in the index of industrial production (IIP) of HCMC in the year’s first quarter.

Although the city’s IIP fell, it showed signs of improvement as the year progressed, Vu said, adding that the southern metropolis saw IIP plunging by 15% year-on-year in January, 2.5% in the first two months of the year, and 0.9% in the first quarter.

He said the city’s industry-trade department would continue supporting local companies in business and production. It is planning to launch a market stabilization program in the second quarter to stimulate consumer demand.

Apart from that, the department would hold a conference to boost the export activities of local businesses. The event, slated for late May, aims to help enterprises expand their market, secure raw material supplies and ease exporters’ difficulties.

VN steel industry awaits indication of progress

The steel sector across Vietnam continues to face a variety of challenges to its growth prospects from multiple angles.

The deputy general manager of China’s SUMEC International Technology Co., Ltd., Luan Shorden, arrived in Hanoi 10 days ago to discuss the possibility of selling raw steel.

China manufactures a substantial quantity of steel but imports a substantial amount of crude steel to meet local demand. Vietnam exported 11.68 million metric tonnes of steel to China in 2022.

According to Shorden, Vietnam can regularly and consistently ship crude steel to the Chinese market as a significant supplier, satisfying the cheap and quick criteria. “The continuous expansion of crude steel capacity will support this trade,” he said.

Similar to Vietnam, exports continue to play a key role in China’s surplus steel consumption. “China’s land policy is less advantageous for steel production, with essentially no additional crude steel manufacturing capacity. The growing cost of Chinese steel manufacturing causes exports to lose their pricing advantage,” Shorden added.

China’s steel sector is limiting crude steel output and pushing exports of more steel products to the Middle East, India, and European markets concurrently. According to Shorden, China exported 67.4 million MT of completed steel in 2022, although flat steel accounted for 64 per cent and galvanised steel accounted for 12.5 per cent of total steel exports.

Doan Danh Tuan, vice president of the Vietnam Steel Association (VSA), said that there are few indications that the steel sector’s troubles in terms of supply-demand and raw material costs have subsided. 

It is extremely difficult to discuss the profit margin of the company at this time, he added, citing the fact that many plants are presently only operating at 40-60 per cent of design capacity. According to VSA statistics, crude steel output declined 16 per cent in February 2023 compared to the same month in 2022.

According to Tuan, the price of raw materials varies “not according to the regulations. Currently, iron ore prices are approximately 40 per cent higher than they were at the end of 2022, which is 1.5 times higher than the five-year average. Coal prices are approximately $200 per tonne, which is double the five-year average.

Public investment and a $5 billion credit package for social housing projects are believed to be the primary drivers of the steel industry, resulting in the possibility of strong growth in the second half of the year. 

In its February report, the VSA stated that the new steel potential in Southeast Asia and the plan to shift production to low-cost regions will strengthen its role as a supplier of raw steel to the region, allowing for the import of long-term billet in China as well as finished long steel products.

The new development cycle for the sector has not yet begun, but the sector went through its most difficult phase at the end of last year when the price of hot-rolled coil dropped from more than $900 per tonne to roughly $500 per tonne,” stated Le Phuoc Vu, chairman of Hoa Sen Group, on March 10.

At the present selling price of roughly $700 per tonne, Hoa Sen will have a profit sufficient to recoup the loss in the first four months of this fiscal year during the following three months.

However, Vu believes that the market still faces many macroeconomic risks. In addition, the fierce competition in the domestic market, monetary tightening policies, and hot-rolled steel prices continue to fluctuate in complex ways, which may have a negative impact on demand, production, and the business activities of steel enterprises.

Steel is a unique sector with positive profit growth in 2023, according to Hien, due to the low base year of 2022. Hien predicted that industry leaders with substantial market shares will continue to dominate and recover more rapidly as a result of their brand advantage and distribution capacity.

FPT develops Khanh Hoa investment promotion portal

FPT Corporation has recently launched an investment promotion portal in the coastal province of Khanh Hoa, as part of a joint effort between the provincial administration and the technology service provider.

The Khanh Hoa business supporting platform was inaugurated with the participation of Prime Minister Pham Minh Chinh, representatives from relevant ministries and local administrations.

The portal provides investors access to the province’s development plans and policies, as well as potential projects calling for investment, including non-state capital.

Information on approved plans and local land use status will be made available to domestic and international investors in the initial phase of the site.

FPT Corp and relevant agencies will work closely to upgrade the portal, seeking to provide frequent, transparent information on the socioeconomic performance and development initiatives in Khanh Hoa Province.

In addition, the firm and Khanh Hoa Province signed two memorandums of understanding, with one for cooperation on digital transformation and human resource training and the other for technology development and software production.

FPT will open a software-technology urban complex in Khanh Hoa next year, said FPT Chairman Truong Gia Binh.

HCMC export forum and trade fair set for next month

The HCMC Export 2023 Forum and Trade Fair will be organized at the Saigon Exhibition and Convention Center in District 7, HCMC, from May 25 to 28 to promote trade and help enterprises expand markets.

The trade fair, organized by the HCMC Department of Industry and Trade and the Vietnam Trade Promotion Agency (Vietrade), aims to create opportunities for businesses to find partners, customers and importers, as well as expand their markets.

The event is expected to feature 250 booths from Vietnamese enterprises, foreign-invested businesses, trade promotion agencies, and many associations of agricultural products, textiles and garments, wooden furniture and handicrafts, food, and beverages.

The fair is expected to attract around 8,000 visitors.

As part of the event, the forum “Strengthening linkages towards green exports” will be held on May 25, discussing the potential and strengths of HCMC’s economy, as well as the current challenges facing exporters.

Moreover, the participants will discuss some solutions to promote regional connectivity in the manufacturing industry, agriculture, trade and services, and the development of the green economy.

The “Vietnamese agriculture reaches out to the world” conference on May 26 will help update information on the global market and international supply chains, especially in agriculture and food processing.

Vietnamese wood exporters grapple with waning demand

Vietnamese wooden products exporters are expected to face uncertainties until the end of this year due to falling consumer demand in some major markets, according to VNDirect Securities Corporation.

Statistics from VNDirect Securities Corporation showed that the U.S. demand for housing in February fell 48.1% year-on-year while plywood prices were down to US$410-415 per ton.

Many companies saw their export revenues decline by 10-15% compared to 2022. The gross profit margin of Vietnamese wood exporters is predicted to shrink by 0.6-1 percentage point in 2023 before improving in 2024.

If China, the second largest importer of Vietnamese wooden goods, fully opens its borders in the second quarter of this year, Vietnamese exports would see positive growth.

However, China’s reopening will also intensify the competition for Vietnamese wood-working businesses when exporting products to the U.S. market.

The export value of wood and wooden products was estimated at US$1.2 billion in March 2023, down 22.8% over the same period last year.

In the first quarter of this year, the export value of wood and wooden products saw a year-on-year decrease of 28.3% to US$2.88 billion. Of which, wood product export value reached only US$1.87 billion, down 38.5%.

Life insurers look to expand, raise capital
     
Life insurers are increasing charter capital to meet the requirements of financial safety as well as to fulfil the target of market expansion.

During a recent visit to Viet Nam, Jaime Anchustegui, Generali International’s General Director, continued to reinforce the long-term commitment of the Italian insurance group to the Vietnamese market. According to Jaime Anchustegui, Viet Nam has always been a key growth market for Generali in Asia.

Generali Vietnam currently has a charter capital of VND7.2 trillion.

A report by the Insurance Supervision and Administration Department under the Ministry of Finance shows that the total equity capital of life insurance enterprises by the end of 2022 was estimated at VND125.4 trillion, up 3.8 per cent over the previous year. In 2022, there were four life insurance enterprises that increased their charter capital, with a total additional capital of VND8.94 trillion. Of them, AIA increased by VND5 trillion, Dai-ichi by VND2.1 trillion, FWD by VND1.59 trillion and Phu Hung by VND250 billion.

After the 9th capital increase since its establishment, Dai-ichi Life Vietnam’s charter capital is currently VND9.8 trillion. Meanwhile, FWD has increased its charter capital to more than VND18.5 trillion.

Some other life insurance companies are also planning to raise capital in the near future, in order to continue implementing projects to expand markets, develop distribution channels, as well as increase risk provisions.

According to the Insurance Supervision and Administration Department, in 2022, all life insurance businesses will meet the requirement of solvency margin. The total technical reserve of this sector is estimated at VND493.6 billion, up 14.5 per cent compared to 2021. Total investment back into the economy was estimated at VND592.8 trillion, up 13.9 per cent compared to 2021.

In 2022, the total amount that life insurance businesses pay for insurance benefits was estimated at VND40.6 trillion, including return value payments, maturity expenses, and insurance event expenses as agreed in the insurance contracts, up 25.1 per cent against 2021.

In 2022 alone, Hanwha Life Vietnam paid insurance benefits for nearly 51,000 cases, with a total amount of more than VND402 billion for benefits related to critical illness, death, injuries, disability due to accidents, support for hospital fees, up by 63 per cent in a number of cases and 41 per cent in payment value compared to 2021.

Meanwhile, Manulife Vietnam also paid out nearly VND7 trillion to customers in 2022. This insurance company once set a record in the Vietnamese insurance market with the payment of benefits of more than VND68 billion for one individual customer in November 2021.

Previously, Manulife Vietnam shortened the processing time for some insurance benefits for customers – with a maximum face value of VND100 million – to 60 minutes. The company also invested heavily in upgrading its claim settlement application (eClaims), allowing customers to submit documents online in just 1 minute.

Generali was not only the first life insurer in the market to remove the requirement to submit original financial bills and medical documents when settling benefits, but with the Genvita app, it also helps customers simply submit an online request, get a response within 30 minutes, and receive benefits within 24 hours after benefits are approved for payment. It is known that Generali’s total insurance benefit payment by the end of 2022 was nearly VND4.2 trillion.

For life insurance companies, for many years, shortening the time for review and payment of benefits has been one of the important development strategies in parallel with expanding the customer base and market. 

Viet Nam’s EV market sees great potential

The Vietnamese EV market promises to be more exciting after many years of consumers saying no to hybrid and e-cars, industry insiders said.

Experts believe that Vietnamese people have gradually opened their hearts to green cars. In the next few years, when traffic infrastructure and e-vehicle charging stations are widely available, electric vehicles will be chosen by local users.

Viet Nam’s middle class is growing and live in urban areas while e-vehicles meet the criteria of smart cities, thus people are shifting to green cars that help reduce environmental pollution.

In July 2022, the Vietnamese government approved the action plan on green energy transition and reducing carbon and methane emissions in the transport sector.

The action plan’s overall goal is to develop a green transport system towards net zero emissions by 2050 as Viet Nam committed to at the 26th United Nations Climate Change Conference (COP26).

From 2030, at least half of all vehicles and all new taxis will be powered by electricity or green energy. By 2050, 100 percent of buses and taxis will use these types of energy.

From now to 2050, the transport sector will gradually develop means of transport and strongly convert all vehicles, transport equipment and infrastructure into electric and green energy-powered vehicles towards net zero emissions.

MoT asks VEC to speed up construction of Ben Luc-Long Thanh Expressway

The Ministry of Transport (MoT) has recently asked the Vietnam Expressway Corporation (VEC) to accelerate the progress of the Ben Luc – Long Thanh Expressway construction project.

According to the MoT, the project implementation has not had any positive changes. Currently, some tasks have not been completed as directed by the ministry. Specifically, the adjustment of the project’s investment policy has not been completed; the selection of new contractors for terminated contracts has not been carried out; construction was slow to deploy.

Therefore, the Ministry of Transport requests VEC to urgently work with the Ministry of Planning and Investment to promptly complete the appraisal to report to the Prime Minister for approval of the adjustment of the project’s investment policy. At the same time, VEC needs to coordinate with the Ministry of Planning and Investment and the Ministry of Finance to finish the Government’s draft resolution on arranging reciprocal capital for the project.

The MoT also asks VEC to promptly work with related units to complete the contractor selection procedures to soon implement the construction of bidding packages as planned. Currently, the bidding packages in the Eastern section are at risk of not being completed in 2023, and package J3 cannot be completed in Q3-2025.

According to the report of the Transport Construction Investment Management Authority under the MoT, by early March 2023, the Ben Luc – Long Thanh Expressway project has completed four out of 11 basic bidding packages. One package is under construction with an output of 67.63 percent, which is about 12.73 percent slower than the plan, and six bidding packages have not started.

HCM City’s export processing zones, industrial parks moving to become greener

Export processing zones and industrial parks (IP) in Ho Chi Minh City are on the process of transforming themselves towards green and ecology direction to meet the changing demands of businesses.

A large wave of the movement to other localities is underway among businesses in HCM City, especially those in labour-intensive sectors with low technologies and high risk of causing environmental pollution.

Nguyen Van Khanh, Vice Chairman of the Shoes and Leather Association of Ho Chi Minh City (SLA), said that many businesses in the shoes and leather sector are moving to the countryside of neighbouring localities such as Tra Vinh, An Giang and Kien Giang. Firms staying at IPs are mainly foreign ones, he added.

The movement trend of enterprises is prompting export processing zones and IPs to change themselves.

With the support of the United Nations Industrial Development Organisation (UNIDO), Hiep Phuoc IP has been applying the “industrial symbiosis” concept in its operations, turning waste released from businesses into input materials for others.

Meanwhile, the number of labour-intensive businesses in Tan Thuan IP has decreased to 50% of total 240 firms it is hosting, which is continue to fall.

Currently, HCM City is building a project on developing export processing zones and IPs in the 2025-2030 period with a vision to 2045, which underlined the need for a suitable roadmap to transform the export processing zones and IPs following more effective models.

The city is also working on the mechanism and roadmap as well as a set of criteria for the transformation process of local export processing zones and IPs, which will be inform to businesses and investors soon.

Hua Quoc Hung, head of the HCM City Export Processing and Industrial Zones Authority (HEPZA), said that the HEPZA is seeking measures to encourage businesses that are using backward technologies to upgrade their technologies or move out.

He revealed that in March, the authority will release an official information on the city’s policy for the zones.

Under the city’s planning, HCM City has 23 concentrated export processing zones and IPs covering nearly 6,000 hectares. So far, 19 have been built and 17 have been put into operations with an occupation ratio of about 80%.

Local export processing zones and IPs have attracted 1,665 projects with total capital of 12.5 billion USD. Each year, business in export processing zones and IPs posted an export revenue of about 8 billion USD, accounting for about 21% of the city’s total export turnover excluding crude oil.

Vietnam well-positioned to benefit from AI: website

Artificial intelligence (AI) is poised to revolutionise economies, and Vietnam is well-positioned to reap the benefits and emerge a leader – both development and application, highlighted an article run at intelligent global legal research platform Lexology.com.

According to the article, the Vietnamese government is taking steps to support the development of AI, with initiatives that foster innovation and entrepreneurship. The government is investing in research and development, providing tax incentives for companies that adopt AI technology, and supporting the growth of the startup ecosystem, it noted.

One example is the Vietnam AI Grand Challenge, a programme launched in 2019 to encourage the development of AI technology, it said, adding that it provides funding, support, and resources to AI startups and researchers, helping them develop and commercialise their AI solutions.

Vietnam has also set up several AI Centres of Excellence in universities and research institutions to encourage the development of AI technology. The centers provide support and resources to researchers, and collaborate with industry partners to develop AI solutions for various sectors.

The article also underlined the impacts of AI on health care and agriculture in Vietnam.

However, it held that AI will pose challenges to the Vietnamese labour market. While AI will create new and more dynamic job opportunities, it is also likely to disrupt existing employment. For example, the use of robots is growing, and it will become possible for robots and machines to perform many tasks that are now being performed by humans. This will result in job losses, it explained.

The article stressed that there will need to be appropriate regulations and policies to ensure that AI is used ethically and responsibly, while suggesting some issues need tackling, including privacy and data protection, intellectual property, liability and accountability.

Domestic ICT firms well-positioned to reach out to the world

Vietnam’s information and communication technology (ICT) companies are well-positioned to make strong breakthroughs and reach out to the world in the near future, on the back of widespread Internet access, abundant workforce and support from authorities at all levels.

Statistics from the International Telecommunication Union (ITU) showed that about 49% of the world population, or nearly 4 billion people, have yet to be connected to the Internet. It is a chance for Vietnamese ICT firms to reach globally.

Pavel Poskakukhin, Co-Chairman of the European Chamber of Commerce in Vietnam’s Digital Sector Committee, said thanks to young and tech-savvy population, Vietnamese ICT companies have a lot of opportunities in Europe, especially providing business solutions in e-commerce.

Vietnam now ranks 12th in the world in terms of the number of Internet users with over 70 million subscribers. There are roughly 45,000 ICT firms with more than 1 million employees. The country also leads Southeast Asia with 25 software enterprises obtaining Capability Maturity Model Integration (CMMI) certification, surpassing Singapore and Malaysia.

Last year, Viettel Military Industry and Telecoms Group (Viettel) earned 3 billion USD in revenue from foreign markets while FPT Group raked in 1 billion USD.

Despite a large number, domestic ICT firms are mostly small and medium-sized enterprises.

Viettel Chairman and General Director Tao Duc Thang said when doing business abroad, Vietnamese ICT companies could face risks related to the fluctuations of foreign exchange rate and lack of companions.

He advised them to thoroughly learn about the political and socio-economic situation and laws of the host country before making any investment. They should also stay close with local authorities and build business policies that are closely linked to social welfare.

Providing quality products at affordable costs is a suitable orientation during this technology popularising stage when both rich and poor countries are speeding up digital transformation comprehensively and for more people, said Minister of Information and Communications Nguyen Manh Hung.

In the coming time, the Ministry of Information and Communications (MIC) together with technology associations will support ICT firms by promoting economic diplomacy in digital technology, tapping global trade mechanisms to market digital technology trademarks, holding digital investment and trade promotion forums and conferences abroad, and advising the Government to sign digital partnership deals with countries, Hung said.

He added that the MIC already set up an advisory team to help ICT firms go globally.

Hai Phong moves to develop more industrial parks

The index of industrial production (IIP) of the northern port city of Hai Phong is expected to grow by 13.5 – 14.5% per year, towards increasing the proportion of the manufacturing industry in GRDP to 46%.

According to Chairman of the municipal People’s Committee Nguyen Van Tung, Hai Phong is striving to promote three economic development pillars of industry – technology, seaport – logistics, and tourism – trade, especially industrial development in a modern, smart and stainable manner.

The locality has paid special attention to drastically developing industrial parks and clusters, which play a decisive role in the city’s socio-economic development.

Head of the Management Board of Hai Phong Economic Zone Authority (HEZA) Le Trung Kien reported that the total investment in IPs and economic zones accounts for 93% of the foreign direct investment (FDI) capital invested in the city.

In 2022, over 81% of FDI was poured into 56 projects operating in high technology, processing and manufacturing. Businesses operating in local economic and industrial zones posted a combined revenue of 26.7 billion USD, contributing 16.13 trillion VND (over 680 million USD) to the local budget and creating jobs for over 195,000 labourers.

According to HEZA, Hai Phong is home to the Dinh Vu – Cat Hai Economic Zone and 14 IPs that are operating in infrastructure investment, construction and business with a total area of over 6,000ha.

Under an action programme of the Standing Committee of the municipal Party Committee, Hai Phong plans to develop 15 more IPs with a total area of over 6,200ha in the 2021 – 2025 period.

The Prime Minister has given in-principle approval for the infrastructure development of the two projects of Xuan Cau and Tien Thanh IPs.

The Ministry of Planning and Investment is working on procedures for building the four others namely Nam Trang Cat, Thuy Nguyen, Trang Due, and Giang Bien.

Leaders of the municipal People’s Committee had meetings with representatives of HEZA, localities and investors of IPs to review difficulties and obstacles related to land clearance and disbursement of capital, and discuss measures to accelerate the development of IPs in Hai Phong.

In parallel with the development of new IPs, municipal authorities have also concentrated on expanding existing IPs and industrial clusters, towards creating solid foundation to attract more investment inflows, developing Hai Phong into one of the leading localities in industrialisation and modernisation in the country in accordance with the Politburo’s Resolution on building and development of Hai Phong city by 2030, with a vision to 2045.

Khanh Hoa’s tourism sector seeks ways to bounce back

Despite a remarkable recovery last year, it is still a long way for the tourism sector in the central coastal province of Khanh Hoa to regain its pre-pandemic growth level, requiring endeavours to fully tap the local potential and advantages.

In 2022, the province raked in nearly 14 trillion VND (590.5 million USD) in revenue, about half of the 2019’s figure of over 27 trillion VND.    

This year, it set targets of welcoming 4 million tourists, including 1.5 million foreign visitors, and earning approximately 21 trillion VND.

Toward the goals, the domestic tourist market still plays a key role, with significant attention paid to the expansion of traditional and potential international ones such as the Republic of Korea, China, Malaysia, India, Japan, Thailand, Russia, and Kazakhstan.

Khanh Hoa plans to launch a myriad of tourism communications and promotion activities to stimulate demand, and to host field trips from delegations of international and domestic travel companies. The province will also develop regional linkages, work with airlines to open more routes, and build a digital map of local tourism.  

Le Huu Hoang, Standing Vice Chairman of the provincial People’s Committee, said the province will focus on tourism development planning and policies to encourage and support investment attraction serving the diversification and improvement of product quality meeting international standards.

Emphasising Khanh Hoa’s strength in sea and island tourism, he noted focus will also be placed on the development of entertainment facilities, ecotourism, community-based, spiritual, and medical tourism, among other types.

Viet Nam’s probiotics market attracts RoK businesses
     
Businesses from the Republic of Korea (RoK) have been reportedly promoting probiotics marketing to tap into growing demand in Viet Nam.

During the five-year period through 2021, Viet Nam’s imports of this kind of products grew by an annual average of 16 per cent. The country imported those products mainly from the US (31 per cent), Singapore (22 per cent), and Malaysia (5 per cent), statistics show.

Probiotics are said to be the most typical nutritional supplements in Viet Nam. Local consumers prioritise trustworthiness and safety instead of prices, and they tend to prefer imports such as those from the US, Europe and Japan.

In 2021, Viet Nam imported about US$41 million worth of probiotics from the RoK, turning this Northeast Asian country into the fourth largest supplier in 2021, from 8th position in 2017. Imports from the RoK increased about 23 per cent each year during this period.

Some Korean products distributed in Viet Nam include Vitamin PLUS of Ildong Foodis, Duolac Baby Probiotics of Cell Biotech, and Daily Probiotics of Mediogen. Like other imports, Korean products are classified as high-end items sold at relatively high prices compared to local products.

Viet Nam’s fruit and vegetable exports rise about 18%
     
Viet Nam’s fruit and vegetable exports in the first two months of this year reached US$592 million, an increased of nearly 18 per cent compared with the same period last year.

China was the main market for Vietnamese fruits and vegetables, accounting for 57.5 per cent of exports, according to the Ministry of Agriculture and Rural Development’s Department of Agricultural Products Processing and Market Development.

This is attributable to China’s re-opening in early January and its increasing importation of fruits and vegetables from Viet Nam and the efforts of Vietnamese exporters to maintain orders with partners in the US, the European Union (EU) and Japan.

The trade of goods at border gates between Viet Nam and China has increased. As many as 220,000 tonnes of fruits were exported to China via border gates in the northern province of Lang Son from January 1 to February 13, a hike of 40 per cent year-on-year.

According to Nguyen Thanh Binh, President of the Viet Nam Fruit and Vegetable Association, 2023 is expected to be a good year for Viet Nam’s fruits and vegetables export industry, especially durian.

China remains the largest importer of Vietnamese durian among other key names including Australia, the US, Japan, and Taiwan (China).

Banana exports are also expected to exceed $300 million thanks to a protocol signed with China in November 2022.

Viet Nam is the second biggest exporter of bananas to China after the Philippines.

The export of dragon fruit, banana and durian is expected to contribute $2 billion to the country’s export turnover in 2023.

Fruit and vegetable exports recorded positive results in early 2023, reaching $300 million in January, up 3 per cent year-on-year.

This promises to help the sector realise its goal of $4 billion in revenue this year, a year-on-year surge of 20 per cent.

Viet Nam’s exports of durian and pomelo to the US and China have been increasing steadily this year. Freight rates have decreased to pre-COVID levels, creating favourable conditions, according to exporters.

Surveys in the Mekong Delta show that the prices of durian, dragon fruit, jackfruit, and sweet potato have all doubled or tripled compared to last year, with the durian price surging to a record high of VND190,000 ($8) per kilogram at the farm.

Viet Nam imported fruits and vegetables worth $289 million in the first two months of this year, a 12 per cent increase, the department said. 

Difficult year awaits shrimp exporters: experts
     
Vietnamese shrimp exporters will face a number of challenges this year, including strong competitors from other countries and high production costs, experts have warned.

Viet Nam has around 747,000 hectares of saltwater shrimp farms which produced over 1.08 million tonnes last year. Exports were worth US$4.3 billion, or 40 per cent of the country’s total seafood exports, after rising by 11.2 per cent.

The world’s second largest exporter ships the crustacean to around 100 markets, with Europe, the US, Japan, and China being the biggest ones.

But there would be head winds in 2023, according to Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers, told a shrimp industry conference last week in Soc Trang Province.

Global prices having been dropping since mid-2022, and would continue to do so as supply increases, he said.

“Viet Nam’s shrimp also has to compete with strong rivals such as Ecuador and India. In 2023 Ecuador’s white-legged shrimp output is expected at 1.5 million tonnes, double that of Viet Nam’s. The country has geographical advantages and low production costs.”

Vuong Quoc Nam, deputy chairman of Soc Trang People’s Committee, a major exporter, said shrimp production has been buffeted by climate change, rising petrol prices and input costs and shrimp diseases.

Experts told the conference that Viet Nam’s shrimp production costs are higher than its neighbours’ since businesses still have to import shrimp seeds.

The issuance of farming area codes to ensure traceability is also limited, and farming households and businesses struggle to acquire land or invest in large-scale concentrated farming areas due to rising land prices.

Deputy Minister of Argiculture and Rural Development Phung Duc Tien said farmers, businesses and authorities need to work together more closely to address industry problems. 

Ha Nam to have one more industrial park

The northern province of Ha Nam has got the nod to develop a 100-hectare industrial park, with a total investment of VND977 billion.

Deputy Prime Minister Le Minh Khai signed a decision allowing the province to implement the second phase of the Thai Ha industrial park project.

The facility will encompass Bac Ly, Tran Hung Dao and Chan Ly communes in Ly Nhan District, the local media reported.

Hop Tien Company also received the green light to be the park developer, which is set to operate in some 50 years.

The deputy prime minister last month approved the Planning and Investment Ministry’s proposal to add four industrial parks in Ha Nam Province to the country’s industrial park development plan.

The four parks, which cover a total area of 940 hectares of land in Kim Bang District and Duy Tien Town, comprise Dong Van V, Dong Van VI, Kim Bang I and Chau Giang I.

Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes