VIETNAM BUSINESS NEWS JANUARY 9

The Vietnamese stock market witnessed a strong performance with an improvement in liquidity in the first trading week of 2023. The positive news was attributed to the bullish trend, according to experts.

The smooth beginning raises hope that the market will run more actively, creating disbursement opportunities for short-, medium-, and long-term investors.

According to experts from VNDirect Securities Corporation, the market focused on several internal and external factors in the first week of 2023, including China officially announcing the opening of international flight routes on January 8; phase 2 of the East North-South Expressway Project being officially launched on January 1; and draft amendments to Decree 65 amending and supplementing several articles of Decree 153 on the offering and trading of a private placement of corporate bonds in the domestic and international markets being submitted to the Ministry of Justice.

Indices all posted outstanding performances. Of which, the VN-Index on the Ho Chi Minh Stock Exchange (HoSE) soared by 4.4 per cent to 1,051.4 points last week, while the HNX-Index on the Ha Noi Stock Exchange (HNX) increased by 2.6 per cent to 210.6 points, and the UpCOM index jumped by 1.5 per cent to 72.7 points.

The market’s liquidity improved, with the average trading value of the three exchanges rising 9.3 per cent to over VND11.7 trillion (US$499.5 million). Last week, foreign investors continued to be net buyers due to a stable macro-economic backdrop and appealing stock valuations.

Specifically, at the beginning of the new year, foreign investors net bought more than VND1.6 trillion on HOSE, VND87 billion on HNX, and VND2 billion on UpCOM.

VNDirect said that after the positive week, the market’s benchmark VN-Index is heading to a strong resistance area of around 1,070 points.

Although there have been some positive macro signals, such as a cooling of exchange rates and a slowdown in rate hikes, cash flows are unlikely to improve dramatically as the Lunar New Year (Tet) is coming near.

Traditionally, investors tend to lower the margin ratio to reduce interest expenses ahead of the long holidays. Therefore, it is difficult to expect the market’s momentum to be maintained in the weeks leading up to Tet.

Therefore, short-term investors should consider reducing their holdings of stocks when the market enters strong resistance areas around 1,070 points and buying them back once it corrects.

Long-term investors, on the other hand, can continue to hold stocks and wait for stock indices to break out when cash flows improve post-Tet holidays.

Meanwhile, Saigon-Hanoi Securities JSC (SHS) said that the market had sent many positive signals at the end of 2022 and the beginning of 2023, given the net buying streak from foreign investors and positive movements of some pillar stocks, including bank stocks.

At the current state, the VN-Index is expected to escape the downtrend shortly. Previously, the market fell for four consecutive weeks.

Even if the VN-Index exits the bearish trend, the market is unlikely to enter the bullish phase immediately. Instead, it will move in recovery waves with narrowing ranges to accumulate more before the uptrend occurs. Therefore, at the moment, investors can participate in the market with a short-term position, as SHS recommended.

From a medium- and long-term perspective, SHS said that it is clear that after a year of trading in the downtrend, the stock price levels have dropped sharply and become more attractive, even though the market still faces many challenges this year.

Many obstacles exist, such as rising interest rates, diminishing cheap money sources, and the gloomy global economy. The discounted stock prices to the current levels will open up new attractive medium- and long-term investment opportunities. 

Korean Air allowed to fly to Lam Dong

Korean Air – the flag carrier and the biggest airline of the Republic of Korea (RoK) – has been permitted to operate irregular flights carrying passengers between Incheon and Lien Khuong airport in the Central Highlands province of Lam Dong from January 4-24.

In a document sent to the Civil Aviation Authority of Vietnam and relevant agencies, the Ministry of Transport informed them of the decision and emphasized that the flights must ensure compliance with current regulations and directions of the Prime Minister, and instructions of the Ministry of Health and the Ministry of Transport on COVID-19 disease prevention and control. 

The Civil Aviation Administration of Vietnam is asked to coordinate with relevant agencies to arrange personnel and  infrastructure to serve international flights operated by the Korean Air, ensuring safety and security.

Ministry calls for early issuance of standards, regulations on charging stations

The Ministry of Industry and Trade has asked the Ministry of Sciences and Technology to develop and issue standards and regulations on the design, installation, and operation of electric vehicle charging stations as early as possible.

According to the ministry, the electric vehicle markets are thriving in the world with China, Europe, and US being leading ones.

Correspondingly, the electric charging industry including the production and installation of charging stations, charging services, and other services, is rapidly developing.

Vinfast – the only electric car producer in Vietnam – planned to develop over 2,000 stations with over 40,000 doors at parking areas in apartment buildings, office buildings, supermarkets, universities, and hotels. 

According to the trade ministry, data show that the State management standards and regulations for electric vehicles and electric charging stations are still limited. The country still lacks management regulations on the design, installation, operation, and measurement of charging stations.

Therefore, additional measurement management for chargers is necessary to make them compatible with regional and international ones. The move is also expected to meet the needs of manufacturers and importers, and protect consumers.

Mechanisms needed for new investments to increase oil refinery capacity
     
Ways must be found to boost investment in improving oil refinery capacity to meet domestic demand while decreasing reliance on imports. This is especially important as global oil and gasoline prices fluctuate significantly.

The Dung Quat Refinery, Nghi Son Refinery and Petrochemical Complex, and processing plants with a total annual capacity of 14 million tonnes of petrol and oil, meet about 70 per cent of the domestic demand, according to the Ministry of Industry and Trade. Imports make up for the shortage.

The Vietnam Oil and Gas Group (PetroVietnam) proposed to increase the Dung Quat Refinery to 7.5 million tonnes per year and does not have any plans to expand Nghi Son.

The ministry estimated that by 2045 Viet Nam would face a shortage of 12 million tonnes of petrol and oil per year and 3.5 million tonnes of petrochemical products.

PetroVietnam anticipated bigger shortages compared to the ministry’s estimate, nearly 12 million tonnes of petrol and oil by 2025 and nearly 20 million by 2030.

PetroVietnam proposed a refinery complex to be developed in Ba Ria – Vung Tau with a capacity of 12-13 million crude oil per year in the first phase, together with 660,000 tonnes of condensate, LPG and Ethane to bring to the market 7-9 million tonnes petrol and oil and 2-3 million tonnes petrochemical products per year.

In the second phase, the project would be expanded to increase the production capacity by 3-5 million tonnes of petrol and oil and 5.5-7.5 million tonnes of petrochemicals.

In addition, PetroVietnam also proposed a national crude oil and petroleum product reserve project with a scale of one million tonnes of crude oil and 500,000cu.m petroleum products per year. PetroVietnam estimated that around US$12.5-13.5 billion was needed to build the complex in the first phase and $4.5-4.8 billion in the second phase.

Finance-banking sector fulfills 2022 goals: minister

Minister of Finance Ho Duc Phoc has said the finance-banking sector accomplished its set goals for 2022, with State budget collection surpassing the estimate by nearly 20% amid unfavourable changes in the country and the world.

As of December 15, revenues to the State budget exceeded the estimate by 19.8%, 78 trillion VND higher than the figure reported at the National Assembly’s fourth meeting in October and November. This ensures resources for socio-economic recovery and the development programme, Phoc told Vietnam News Agency in a recent interview.

As of late 2022, public debts were about 43-44% of GDP, Government debts roughly 40-41% of GDP, the country’s foreign loans are 40-41% of GDP. The Government’s direct debt repayment obligations were from 18-19% of the total State budget revenue, within the scope permitted by the legislature.

Phoc said in the near future, the Ministry of Finance will continue closely monitoring the situation to suggest measures for this year, such as extending deadlines for tax and land rent payment, reducing preferential import taxes on raw and input materials for production as well as environment protection taxes on petrol products.

In the long term, the ministry will continue consulting with competent authorities to fine-tune tax policies up to international standards, and contribute to creating a favourable and fair business environment for sustainable economic development.

Reforms will be underway in all aspects, including improving the effectiveness and efficiency of apparatus, stepping up administrative reform; modernising the financial sector, especially in taxation and customs, toward improving national competitiveness, he said.

In order to fulfill 2023 goals, Phoc said the ministry will continue with measures to support citizens and businesses, revise tax-related laws under the tax system reform strategy till 2030, fine-tune laws on price management and flexibly manage prices based on supply-demand forecasts with energy, construction materials, iron and steel.

Logistics digitization remains sluggish in HCMC

The digitization level in the operations of HCMC-based logistics firms, which account for half of the country, has yet to meet expectations, according to data from the Vietnam Logistics Business Association.

Only 10.2% of logistics firms in the city use the barcode application, while it was 2.5% for adopting the RFID tag, or radio frequency identification technology, to support operations.

As for enterprise resource planning (ERP), the proportion of HCMC-based companies applying the technology in the logistics sector was 44.8%. Roughly 41.4% of businesses are equipped with a warehouse management system (WMS).

ERP is a platform for businesses to integrate and manage operational components effectively. Meanwhile, WMS provides a software system that enhances a company’s inventory management and activity control in the supply chain.

In addition, logistics firms in HCMC have had difficulty developing online services on websites, namely tracking orders, e-booking and uploading ship schedules, among others.

In Vietnam, there are roughly 5,000 firms operating in the logistics sector, with 89% being small and medium-sized. Only 1% of the firms are fully foreign-invested and provide multinational logistics solutions. The rest are joint-venture businesses.

HCM City sees influx of regional specialities for Tet

Many regional speciality products are pouring into HCM City ahead of Tet (the Lunar New Year), which falls on January 22.

More than 10,000 agricultural products and other items from across the country are being sold at the ‘Tet Xanh qua Viet – Xuan Quy Mao 2023’ festival.

They include safe vegetables and fruits that meet food hygiene and safety standards, cashew nut, candied fruits, pork and beef pastes, spring rolls, rice, vermicelli, dried bamboo shoot, mien dong (vermicelli made of arrowroot starch), spices from the northern mountainous region such as mac khen (wild pepper grown by the ethnic Thai), hat doi, mac mat, and traditional fish sauce.

It has nearly 100 booths set up by start-ups, craft village co-operatives and businesses from various provinces and cities.

Visitors can find ‘new, green – clean – safe’ products, especially for gifting during the upcoming Lunar New Year, those made by start-ups and OCOPs such as vegetarian products by Bien Phuong Trading Service and Binh Loan Company, dried shrimp and crab-based products from Con Tom Co., Ltd, grapes and apples from Chang Farm, brown rice, and wind-hanging persimmon products.

Vu Kim Anh, deputy director of the Business Studies and Assistance Centre and deputy head of the festival organising committee, said: “We also organise many programmes for visitors such as culinary and Tet dishes experience and making essential oils and healthy products from natural herbs.

Tran Trung Hieu, a resident of District 5 and a visitor at the event, said: “I bought more than VND2 million (US$85) worth of sticky rice, dried bamboo shoot, lap xuong (Vietnamese sausage), dried forest shiitake mushrooms, and candied fruits for Tet.”

A cosmopolitan hub where people from all over the country come to live and work, HCM City has huge demand for regional specialities, especially on occasions like Lunar New Year.

Shops selling northern speciality foods on Dien Bien Phu Street and Chu Manh Trinh Street in District 1 and Tran Quoc Toan Street in District 3 are also crowded these days.

Their popular products include kohlrabi, cabbage, garland chrysanthemum, green onion, carrot and other vegetables, alcohol made from sticky rice, and Van village wine.

Processed foods include gio thu (pig’s head paste), thit dong (braised frozen pork), bamboo shoot pickles, banh chung (square-shaped glutinous rice cake filled with green bean paste and pork), che kho (soft green lentil cake), and Vu Dai traditional braised fish.

The products are more expensive than during normal days and their prices could increase further before Tet, according to shop owners.

Besides northern specialities, people in the city can also find specialities from southern and central regions such as Ca Mau dried shrimp both with and without the shell, Soc Trang pia cake, Hoa Loc mango, Nam Roi pomelo, Lai Vung mandarin, Tra Vinh Tet cake, dried snakehead fish, Nghe An beef paste, and others.

Supermarkets, traditional markets, social networks, and shopping portals also sell all kinds of regional specialities.

Vietnam’s 500 largest enterprises in 2022 announced

The Vietnam Report JSC and VietNamNet online newspaper on January 5 revealed the list of the 500 largest enterprises in Vietnam (VNR500) and top 10 prestigious companies in the fields of pharmacy, logistics, tourism, transportation and animal feed in 2022.

The VNR500 list includes Samsung Electronics Thai Nguyen Co. Ltd., Vietnam Oil and Gas Group (Petrovietnam), Vietnam Electricity (EVN), Vietnam National Petroleum Group (Petrolimex), Hoa Phat Group JSC, Viettel Military Industry and Telecoms Group (Viettel), Vingroup JSC, Vietnam Bank for Agriculture and Rural Development (Agribank), Mobile World Investment Corporation and Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV), among others.

The Hoa Phat Group JSC, Vingroup JSC and Mobile World Investment Corporation, together with Masan Group, Doji Gold & Gems Group JSC, Vietnam Prosperity Joint Stock Commercial Bank (VPBank), Vietnam Diary Products JSC (Vinamilk), Truong Hai Group, Thanh Cong Group and Vietnam Technological and Commercial Joint Stock Bank (Techcombank) are the top 10 private firms in VNR500.

Kon Tum sets to expand medicinal herb production
     
The Central Highland province of Kon Tum has set an objective to expand its medicinal herb production to 25,000 hectares by the year 2030 with Vietnamese Ngoc Linh Ginseng accounting for 40 per cent of the cultivated areas or 10,000ha, according to the provincial People’s Committee.

The objective was set based on the province’s competitive advantage in the production of medicinal herbs and in line with a national development programme to establish several production centres across the country by the central government by 2025.

The committee said Ngoc Linh Ginseng has been well-received and in recent years has proved to be popular among domestic and international consumers alike. The next step will involve production expansion and brand building for the province’s speciality products.

According to the provincial government, the first phase of expansion (2018-20) has been completed. By 2025, the province will be home to 10,000ha of medicinal herbs, with 4,500ha dedicated to ginseng production. Each city, municipality and commune will form at least one production centre, which provides up to 1,000 tonnes of different medicinal herbs.

By the end of 2022, Kon Tum has established nearly 1,750ha of Ngoc Linh Ginseng production, with more than 500ha recently added. The province’s total area for medicinal herbs has reached more than 5,100ha, with 2,500 added last year.

Outstanding achievements in agriculture in 2022

Despite the impact of the pandemic and much political unrest, the agricultural sector secured significant achievements in 2022.

In 2022, Vietnam’s agriculture, forestry, and fishing sector reported an increase of 3.36 per cent in GDP. The total export turnover of agriculture, forestry, and aquaculture reached $53.32 billion, up 9.3 per cent on-year. The trade surplus for the whole year was $8.5 billion, according to the Ministry of Agriculture and Rural Development (MARD) at a press conference on December 30.

The grain yield in 2022 stood at 47.1 million tonnes; 42.7 million tonnes of which was rice, enough to meet the domestic demand, along with animal feed production and export (7.2 million tonnes).

The total live meat weight touched 7.05 million tonnes. A total of 474,300 tonnes was beef, 4.42 million tonnes pork, and chicken was 2.03 million. The total capacity of eggs was 18.3 billion, up 4.4 per cent. Finally, the total aquaculture capacity reached 9.03 million tonnes, up 2,7 per cent on-year.

Nguyen Van Viet, director of the Planning Department under the MARD said, “The agricultural sector has succeeded in expanding its export markets. The industry resolved commercial barriers to take the export turnover to a new record.”

The total export turnover saw a new record of $53.32 billion, up 9.3 per cent on-year. The agricultural products that achieved an export turnover of $3 billion included timber and wood products ($10.92 billion), shrimp ($4.43 billion), coffee ($3.94 billion), rice ($3.49 billion), rubber ($3.31 billion), fruits and vegetable ($3.34 billion), and cashew nuts ($3.07 billion).

Many of Vietnam’s agricultural products have gained access to new markets. For example, durian, sweet potato, and bird’s nests have secured permits to ship to China, and pomelo can now be exported to the United States, longan to Japan, and lemon and pomelo to New Zealand.

Public investment to support real estate market

It is hoped that extended involvement of public investment into related infrastructure development will help accelerate the prospects of the real estate market.

According to the Ministry of Planning and Investment, the National Assembly will approve a public investment plan in 2023 costing $29.5 billion, an increase of about 25 per cent compared to the 2022 plan and an increase of about $11 billion compared to the 2021 plan.

Vu Ngoc Quang, analyst from SSI Research, said that infrastructure development is a factor that investors must keep in their mind when investing in real estate, as this is the long-term growth engine of the industry.

According to Vo Hong Thang, deputy director of Research and Development at DKRA Vietnam, in today’s difficult times, investors who want to successfully catch up need to pay attention to several factors.

Another important factor that cannot be ignored is the local population. Real estate value can increase in areas where urban areas have been formed with full facilities such as markets, hospitals, schools, and other public facilities.

In the southern region, most of the key infrastructure projects under construction or planning pass through the southern province of Dong Nai, such as Long Thanh, Ben Luc-Long Thanh and Bien Hoa-Vung Tau expressways.

With investment from the government, Dong Nai’s transport infrastructure system has become more synchronous and internal transport routes are also well-invested. Besides that, the attraction of Dong Nai real estate also comes from the advantage of being located near Ho Chi Minh City. In addition, Dong Nai is home to over 30 industrial zones (IZs), with plans to open at least eight more by the end of the decade.

The speed of foreign investment attraction and development of IZs is the driving factor for real estate demand in Dong Nai, where more than two million workers live. Therefore, large-scale real estate developers such as Novaland, DIC Corp, Dat Xanh, and Nam Long are placing focus in the province.

In Hanoi, meanwhile, bridges across the Red River, together with four ring roads linking Hanoi with Hung Yen and Bac Ninh provinces, are changing the landscape and real estate potential of a range of neighbouring areas.

VCCI calls for fewer inspections for vehicle energy consumption
     
There should be a limit on the number of inspections performed a year for energy consumption of electric, hybrid cars and motorbikes, said the Vietnam Chamber of Commerce and Industry (VCCI).

The inspections, while necessary to ensure manufacturers report accurately vehicles’ energy consumption as required by the authorities, could interfere with their day-to-day operations.

The chamber also had a quibble about how accurate manufacturers’ reports must be as they said there were still contradictory clauses in a draft energy consumption law, soon to take effect nationwide.

On one hand, current regulations require manufacturers’ to modify and publish their vehicles’ energy consumption in cases where previous reports were not in line with inspectors’ calculations.

On the other hand, the law allows a 4 per cent margin (lower or higher than the manufacturers’ reported figure). The chamber raised a question on whether figures within this margin are considered inaccurate and therefore, may require a modification on the manufacturers’ part. The chamber stressed the importance of being consistent and eliminating contradictory clauses to ensure there wouldn’t be complications during implementation.

The chamber proposed the number of inspections per year shall not exceed two with a schedule published in advance on government websites.

Vietnam’s largest airport expects to serve 3.8 million passengers during Tet

Tan Son Nhat International Airport in Ho Chi Minh City is set to serve more than 3.8 million passengers during the upcoming Lunar New Year festival, known locally as Tet.

It is expecting an increase of 10% in the number of travelers this Tet compared to 2019 before the COVID-19 pandemic.

On January 6, there will be a total of 735 flights landing and taking off from the airport with 110,000 passengers, including more than 35,000 foreign nationals.

The airport is set to serve 123,000 passengers on January 20, one day before the final day of the old lunar year, more than 144,000 passengers on January 29 when travelers return to big cities to work after the long break.

To meet the increasing demand during the holiday season, the airport will increase its capacity to 44 flights per hour between 6:00 a.m. and 23:55 p.m. and 36 flights per hour from midnight to 5:55 a.m., the highest number of flights per hour ever scheduled at the airport.

Green credit initiatives urged to push ahead development

Given stringent domestic capital mobilisation, Vietnam’s banks are turning into international financial institutions for growth expansion, particularly to strengthen their sustainable and environmentally friendly loan portfolios.

Nguyen Hung, CEO of TPBank, last week revealed that the lender is now in talks with a number of international partners in order to seek capital for growth in 2023. It occurs against the backdrop of growing interest from foreign financiers in a more profitable and tech-driven TPBank.

In January 2022, TPbank inked a tripartite agreement with the Asian Development Bank (ADB) and DEG, a subsidiary of KfW, with a total value of up to $50 million to support female-owned businesses in Vietnam.

Hung also disclosed that TPBank has been able to cut its operational expenses by around 30 per cent thanks to the use of cutting-edge technological solutions. Approximately 95 per cent of the bank’s transactions are conducted through digital channels.

He further shared that he anticipates a growth in total assets for TPBank of at least 14 per cent in the next year.

In mid-December, Hanoi-headquartered lender MSB and Proparco, a development finance institution partly owned by the French Development Agency, inked a loan cooperation agreement worth $30 million with a 5-year term. This agreement is set to support financial resources for Vietnam’s green projects.

Proparco will provide MSB with technical assistance to enhance the bank’s capacity to implement an environmental, social, and governance (ESG) system up to the highest international requirements.

Nguyen Hoang Linh, CEO of MSB, highlighted that the bank’s pursuit of sustainable development takes into account benefits for consumers, shareholders, and the interests of other stakeholders. Proparco’s support is expected to increase MSB’s commitment to integrating ESG factors into its business strategy, enabling the bank to continue making constructive contributions to economic development.

In the same vein, VPBank in late November signed a syndicated loan arrangement worth $500 million with five prominent financial institutions – Sumitomo, the ADB, the Japan International Cooperation Agency, ANZ Bank, and Maybank Securities.

The loan proceeds will then be utilised by the bank to finance small- and medium-sized enterprises (SMEs) and businesses led by women in the country.

VPBank could extend its credit facility to social projects dedicated to the improvement of fundamental infrastructure and Vietnam’s socioeconomic development.

VIB in November also completed disbursement of a $150 million loan from the International Finance Corporation. In March, it also mobilised a syndicated loan worth $260 million from the ADB and other lenders.

The funding comprises a direct ADB loan of $100 million and a syndicated loan of $160 million arranged by ADB and UOB from nine banks headquartered in China, Thailand, India, and elsewhere.

The syndicated loan agreement is expected to enhance access to finance for SMEs and individual businesses, and promote capital financing for quality housing for individual customers in Vietnam, VIB said in a statement.

Dr. Le Dat Chi, vice dean at the Faculty of Finance at the University of Economics in Ho Chi Minh City, believed that in the light of stringent capital mobilisation conditions in Vietnam, tapping into foreign cash would help to better fulfill banks’ demands, and therefore enhance their stability amid a volatile market.

Banks need to be subjected to stringent due diligence by international organisations before they can effectively tap into syndicated loans on the international market or issue foreign bonds with significant value and attractive interest rates.

Quang Ninh aims for over 10% in 2023 economic growth

This year, the northern province of Quang Ninh targets a growth rate of over 10% in gross regional domestic product (GRDP) and will focus on improving investment attraction and people’s life quality.

The province also looks to collect over 54 trillion VND (2.3 billion USD) in state budget revenue, including more than 12 trillion VND from export and import, while recording an over 10% increase in total investment.

It also eyes to keep its position among the best performers nationwide in terms of the Provincial Competitiveness Index (PCI), Public Administration Reform (PAR) Index, Satisfaction Index of Public Administration Services (SIPAS), and Provincial Governance and Public Administration Performance Index (PAPI), according to a resolution on orientations and tasks for 2023 issued by the provincial Party Committee.

This resolution also underlined the determination to sustain a double-digit growth rate for 2021 – 2025 and develop Quang Ninh into a modern service and industrial province, an international tourism hub, a maritime economic centre, a centre of dynamic and comprehensive development in the northern region, and an important transport gateway of Vietnam.

Secretary of the provincial Party Committee Nguyen Xuan Ky said to obtain the targets, Quang Ninh will promote the implementation of breakthrough steps to press on with comprehensive reforms to secure sustainable development, green and inclusive growth, and all-round development in terms of economy, politics, culture, society, and environment, while firmly safeguarding security and national sovereignty.

It will continue using public investments to attract private ones, especially through public – private partnership (PPP), improve the attraction of foreign investment to industrial parks and economic zones, prioritise investments in high-tech and environmentally friendly projects, and strongly facilitate private and startup companies.

Consumers able to order VinFast’s VF6 and VF7 as of March

From March this year consumers will be able to make reservations to purchase Vinfast’s high-quality electric SUV models, including VF6 and VF7, both of which debuted in 2022.

This information was released by VinFast, a member of private conglomerate Vingroup, at the Consumer Electronics Show CES 2023 (Las Vegas) held on January 5.

During the event, VinFast unveiled the detailed technical specifications of two electric SUV models, VF6 and VF7, adding that it would open early reservations starting from March.

Both VF6 and VF7 are two models of the B-C segment that have a sophisticated style and have been designed by world-famous car designer Torino Design.

HCMC targets VND160,000-billion revenue from tourism in 2023

The HCMC Department of Tourism expects the city to attract 40 million tourists, including five million foreigners, and earn around VND160,000 billion from tourism services this year.

Tourism Department director Nguyen Thi Anh Hoa said the city would take a range of measures to boost the city’s tourism market in response to the rising demands of domestic and foreign visitors. 

Local authorities will prioritize the annual activities during the HCMC Tourism Festival and promote the city’s tourist attractions on foreign news channels, including CNN. 

The HCMC government has sought to improve tourism marketing, update destination information on mobile applications and launch promotional events using three-dimension technology. 

Between January and November of 2022, the city attracted around 3.1 million foreign tourists and 28 million domestic travelers. During the period, HCMC earned VND117,988 billion, a 176.5% increase against 2021.

Kien Giang looks to attract projects worth 182 million USD

The Mekong Delta province of Kien Giang aims to secure investment in six projects covering a total of 69ha, with a registered investment capital of approximately 4.3 trillion VND (182.2 million USD) in 2023.

The province also strives to disburse capital out of budget to implement projects at about 24 trillion VND.

Chairman of the provincial People’s Committee Lam Minh Thanh emphasised that the province is focused on completing the planning of Kien Giang province in the 2021–30 period, submitting it to the Government for approval and announcing the plan according to regulations.

The province will review, update and supplement the list of projects calling for investment of non-budget capital in the 2021–25 period to serve as a basis for promoting investment attraction and granting a new decision to approve the policy for project investment.

The province will implement preferential policies to attract investment.

Positive signals for rice exports in 2023

Vietnam exported nearly 7.2 million tonnes of rice worth 3.49 billion USD last year, including many shipments navigating demanding markets such as Japan and the European Union (EU).

Minister of Agriculture and Rural Development Le Minh Hoan said the sales signaled that Vietnamese rice has gained better quality, from choosing varieties for cultivation and standardisation to meet requirements of each market.

Aware of the need to build long-term business strategies, major rice exporters such as Trung An Hi-tech Farming JSC and Loc Troi Group have teamed up with farmers and cooperatives in material zones to generate stable and quality rice supply.

Vice Chairman of the Vietnam Food Association Do Ha Nam said thanks to jasmine and high-quality rice, Vietnam won a number of markets and recorded fast growth in demanding markets such as the US and the EU.

Many firms already received orders until April or even the third quarter of this year.

The VFA forecast that domestic rice exporters have a distinct advantage this year thanks to high rice prices and huge demand from China, the Philippines and Africa.

The Philippines, the biggest importer of Vietnamese rice, has decided to maintain import tax of 35% this year. Meanwhile, the second Vietnamese rice importer  – China – will lift its zero-COVID policy and reopen its borders with Vietnam, Nam said.

Investors make decisions on different investment channels
     
Entering 2023, investors are choosing investment channels that bring high profitability amid the current financial market where there are many unprecedented risks.

According to Huynh Anh Tuan, General Director of Dong A Bank Securities Company (DAS), saving accounts are still the most attractive investment channel, at least until the end of the first quarter of 2023.

With gross domestic product (GDP) growth of more than 8 per cent, the country’s consumer price index (CPI) under control below 4 per cent in 2022, and bank deposit interest rates reaching 12 per cent, savers still enjoy positive real interest, he said.

Entering 2023, although macroeconomic conditions are forecast to see many challenges, GDP is forecast to still grow positively, reaching 6.5 per cent and an inflation target below 4.5 per cent.

Although commercial banks recently pledged to reduce the deposit interest rate to below 9.5 per cent per year, the roadmap for reducing interest rates is likely to require more time, especially when the liquidity of some small banks is still at a low level. Therefore, at this time, banking deposit is the most attractive investment channel.

Tuan said through the third quarter of 2023, deposit interest rates are expected to cool down. At that time, securities are likely to become more attractive investment channels for investors. But at the present time, the stock market still sees many unpredictable risk factors, but there are still some industries that are forecast to prosper again.

Phan Dung Khanh, investment consulting director of Maybank Investment Bank, also said that banking deposit is still the best investment channel in the first half of 2023. In the second half of 2023, when the stock market becomes more stable with a safer buying zone, individual cash flows can come back in, making the market more active.

Dinh The Hien, a financial expert, predicts that the stock market is likely to prosper in 2023, because stock prices are hitting lows. When financial and banking markets are stable and interest rates tend to decrease, the stock market is expected to recover strongly.

In 2022, Viet Nam’s stock market was one of the strongest falling markets in the world, as the VN-Index fell more than 34 per cent compared to the beginning of 2022. Experts said that although the stock market still sees many unpredictable risks and investor sentiment is still weak, the stock market still has some main supportive points.

Viet Nam’s economic growth is forecast to remain at a high level compared to the world average, while well-controlled inflation will be a bright spot to attract foreign investment flows. Difficulties in cash flow liquidity in the economy are also being focused on by the Government and related ministries and sectors.

However, experts also say that investors need to avoid speculative stocks, and choose the right stocks of businesses with solid financial foundations, stable operation and little influence of short-term fluctuations.

Contrary to the positive trend of savings and securities, investment channels in gold, foreign currency, bonds, and real estate are forecasted to be less positive.

According to Huynh Anh Tuan, since Decree No 24/2012/ND-CP dated April 3, 2012 of the Government (Decree 24) and Circular No 16/2012/TT-NHNN dated May 25, 2012 of the State Bank on the management of gold business came into effect, the domestic gold market prices struggled to keep pace with the world market. The gold investment channel is also less attractive to domestic investors.

Can Van Luc, a financial expert, also said that with the current gold market, short-term investment can be quite risky, because the domestic and international gold prices are not connected. However, investing in gold as a long-term accumulation channel is still acceptable.

Foreign currency investment, especially the US dollar, is also considered unattractive, as the USD/VND exchange rate has increased sharply in 2022 and is not expected to have many strong changes in 2023.

According to experts of MB Securities Joint Stock Company (MBS), foreign exchange pressure may return but it is unlikely to be as negative as in 2022. As planned, the US Federal Reserve (Fed) will still increase rates in 2023, but the pressure will be lighter as the US dollar has levelled off against most other currencies, including the Vietnamese dong.

MBS’s analysis team said that in 2023, the Vietnamese dong is expected to depreciate by about 2 per cent in the context that the Fed will stop raising interest rates after March 2023.

As for real estate, analysts predict that the market is still quiet and struggle to recover in 2023.

According to Can Van Luc, for the real estate channel, some segments are currently facing difficulties such as resort real estate and tourism in the context that the cash flow for investment loans is being squeezed. However, residential real estate in some areas benefiting from infrastructure still has a positive outlook.

Therefore, investors need to identify and prioritise safe-haven investment channels, such as potential real estate segments like houses, industrial park real estate, and land plots in areas with synchronous infrastructure, full legal conditions and reputable and professional investors.

In the context that the financial market still sees many unpredictable variables, experts say that investors should diversify investment channels, carefully make investment and selling decisions, and avoid false rumours. 

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