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Furthermore, in October 2023, domestic individual investors closed 545,326 securities trading accounts, which has also played a role in a significant drop in market liquidity.
Information from the Vietnam Securities Depository (VSD) reveals that during October 2023, domestic individual investors closed 545,326 securities trading accounts. Consequently, the number of investor trading accounts reduced from 7.8 million accounts at the end of September to 7.45 million accounts by the end of October.
This marks an unprecedented occurrence in the 23-year history of the Vietnamese stock market. Individual investors closed securities accounts during a month of negative trading in the Vietnamese stock market, as the VN-Index plunged by almost 11 percent. Additionally, foreign investors also registered net selling for the seventh consecutive month, resulting in a total net withdrawal from the stock market in October 2023, amounting to more than VND2.72 trillion.
The sharp decrease in the number of individual investor securities accounts may be linked to initiatives aimed at data cleansing. In October 2023, the Prime Minister directed the State Securities Commission to establish a connection with the national population database to purify data concerning individuals involved in securities trading, which involves cross-referencing information to ensure accuracy and remove incorrect, duplicated, or fictitious data. The deadline for completing this task was November 2023.
Binh Dinh promotes investment cooperation with foreign partners
The provincial People’s Committee of the south central province of Binh Dinh on November 11 organised a conference with heads of foreign diplomatic missions and organisations in Vietnam to promote exchanges and connectivity, and introduce the locality’s potential, advantages, and development orientations.
Speaking at the event, Secretary of the provincial Party Committee Ho Quoc Dung stated that Binh Dinh is committed to creating favourable conditions for foreign agencies, businesses, organisations, and individuals to live and work in the province.
Chairman of the provincial People’s Committee Pham Anh Tuan said that Binh Dinh welcomes investors boasting modern, environmentally friendly technologies, efficient use of resources, and competitive products, with priority sectors including agro-forestry-fishery, industrial and logistics services, tourism and urban economy.
Malaysian Ambassador to Vietnam Dato Tan Yang Thai stated that Malaysia sees enormous potential and opportunities in Vietnam and committed to further enhancing the two nations’ trade and investment cooperation.
Thai Consul General in Ho Chi Minh City Wiraka Moodhitaporn said Thailand is ready to closely cooperate with international partners, including Vietnam, to promote sustainable development.
On this occasion, the People’s Committee of Binh Dinh province signed an international cooperation agreement with the Korea Land and Housing Corporation.
Nghe An province calls for US investment
The central province of Nghe An introduced its investment environment and prioritised investment areas to US investors at a forum held in Washington D.C on November 9.
Addressing the event, Ambassador to the US Nguyen Quoc Dung hailed Nghe An’s selection of the US for calling investment right after high-level visits between the two sides.
He pledged that the Vietnamese Embassy will continue to coordinate with and support the province in luring more US investors.
Meanwhile, Cindy Shao, President of the Asian American Chamber of Commerce (AACC), a non-profit organisation with nearly 3,000 member businesses, said that the forum was a chance to promote cooperation between US partners and Vietnam in general and Nghe An in particular.
For his part, Chairman of the Nghe An People’s Committee Nguyen Duc Trung briefed participants on the province’s potential and strengths, underlining that the locality has prepared best conditions in planning, infrastructure, land, human resources and administrative procedure support to welcome investors.
The province is calling for investment in its Dong Nam (Southeast) Economic Zone, which comprises five industrial parks covering 2,000 hectares, he said, stressing that Nghe An hoped to receive investment in the fields of semiconductors, manufacturing, new material production, and new energy.
Le Tien Tri, Director of the Dong Nam Economic Zone Management Board, said that Nghe An hoped to foster connections with US partners in the field of high technology and the production of consumer goods, petrochemicals and energy.
Chairman of the AACC Board of Directors John Lin said that Vietnam has many advantages in foreign investment attraction, including technology and human resources. He hoped to arrange an AACC delegation to visit Vietnam and Nghe An soon.
Concluding the forum, participants witnessed the signing of a cooperation agreement between the Management Board of the Dong Nam Economic Zone and the AACC.
Earlier the same day, the Nghe An delegation had meetings with leaders of the US Semiconductor Industry Association and the US-ASEAN Business Council.
Cao Bang studies Niagara region’s experience in cross-border trade, tourism
A delegation from the northern border mountainous province of Cao Bang has paid a working visit to Niagara to foster bilateral cooperation and learn from the Canadian region’s experience in cross-border trade and tourism development.
At an investment promotion conference held as part of the trip, Cao Bang emphasised its desire to seek partnerships to develop its strengths in border economy and tourism services. As a border economic zone strategically located between Canada’s industrial centres and the US’s major cities as well as a famous tourist destination with waterfalls attracting millions of visitors annually, Niagara is highly suitable for this development direction.
IBT College, representing the Niagara Economic Development Committee, signed a cooperation agreement with Cao Bang, serving the two sides’ exchange of study tours and the training of tourism personnel for the latter.
Talking to the Vietnam News Agency’s reporter in Canada, Vice President of the IBT College James Rice hailed Cao Bang’s Ban Gioc waterfall as an unpolished diamond, similar to Niagara Falls many years ago. It offers an opportunity for Vietnam to leverage and develop Cao Bang in the future.
According to him, the IBT College is closely collaborating with the province to open an educational facility serving the training of tourism services for local tour guides and employees of restaurants and hotels.
Tran Thu Quynh, Trade Counselor at the Vietnamese Embassy in Canada, said the cooperation between Cao Bang and Niagara supports both sides in exploiting waterfall tourism and managing cross-border resources and trade.
Vietnam-Canada trade turnover reached 7 billion USD in 2022 and is expected to hit 10 billion USD in the coming years. Vietnam is currently Canada’s top trading partner in the Association of Southeast Asian Nations (ASEAN).
Hanoi to hasten reforms, enhance competitiveness to facilitate exports
Hanoi would continue to hasten administrative reforms and apply measures to improve competitiveness of local enterprises and producers to expand exports.
The point was highlighted in Plan 257/KH-UBND on strengthening exports of the capital city in 2024 issued in late October.
Accordingly, the capital city aims for exports in 2024 to grow by 5% over 2023.
In the plan, the city pointed out challenges for exports from rising global uncertainties.
“The economic recession risk together with high inflation pressure are causing consumer demand to decline sharply around the world, including Europe and America which are major trade partners of Vietnam,” the plan said.
Energy and food crises as well as disruptions in supply chains and rising material prices were still ongoing. Besides, green economy development was bringing both opportunities and challenges to Vietnam’s exports as developed economies may erect technical barriers.
However, addressing advantages from Vietnam’s stable macro-economy and the Government’s firm solutions to promote production and business, Hanoi said it would focus on devising measures to enhance competitiveness of local enterprises and producers, to be able to best adapt to the new circumstances.
Under the plan, the capital city would strengthen administrative reforms with the focus on promoting the application of information and technology in processing administrative procedures, including tax, customs and certification of origin, to facilitate exports.
In addition, mechanisms and policies would be raised to promote production and exports, especially credit policies, together with solutions to improve the quality of human resources meeting demand of enterprises.
The city would increase the investment attraction in infrastructure and logistics services to facilitate exports, and improve the efficiency of trade promotion programmes.
A recent study on promoting goods export of enterprises in Hanoi by Bui Thi Hoang Lan from the National Economics University suggested the capital city restructure the industrial sector in association with digital transformation to create a new driver for breakthrough export growth.
The capital city should hasten the transition of export goods structure towards increasing added value and quality and establish value chains.
Pointing out that Hanoi lacked foreign capital influx, which was large enough to create breakthroughs to production and export, Lan said that the capital city needed to raise policies to attract more foreign capital.
Besides, improving the competitiveness of enterprises and producers in the city played a very important role in expanding exports. The focus would be on implementing regular training courses to enhance knowledge and skills in product design, brand building, international integration, technical barriers in international trade, new policies, and market updates.
Lan also said that it was important to develop centres of raw materials for the production of export goods, and improve infrastructure of industrial parks to attract more investments in production.
Addressing problems from poor infrastructure, which caused rising logistics costs and undermined the competitiveness of enterprises, Lan suggested Hanoi increase the attraction of investment in logistics infrastructure with the priorities in the systems to connect with other provinces in the Northern key economic region.
Incentives in land policies should be given to the development of logistics centres towards the formation of a logistics market, which would help increase budget revenue, reduce inner-city traffic congestion and remove barriers to goods circulation and exports.
She also proposed policies be raised to attract investment in the development of large-scale “logistics villages” – a completely new business model to facilitate exports.
The latest updates of the municipal Department of Statistics showed that the city reported a trade value of more than 5 billion USD in October, representing a rise of 2.1% against the previous month and 10.1% against the same period last year.
Of the figure, export revenue was estimated at 1.45 billion USD, a year-on-year increase of 7.6%.
For January – October, the city’s total export value reached 13.8 billion USD, a slight drop of 1.4% against the same period of 2022 on falling global consumption demand.
Hanoi reported a total export value of 17.1 billion USD in 2022, a year-on-year increase of 10.6% exceeding the target of 5%, ranking the capital city 8th out of 63 provinces and cities in terms of export revenues.
The export value of the domestic economic sector was 9.181 billion USD, higher than the export value of the foreign–invested sector which was at 7.9 billion USD. This was a spotlight of Hanoi’s export in the context that the country’s export remained dependent of foreign–invested enterprises.
Major export products of Hanoi included garments, computers and electronic components, machinery and components, timber and wooden products, and agricultural products.
In the 2017-2023 period, the city’s export revenue expanded on average 8.2% per year, except for 2020, which saw a drop of 3.4% due to the impact of the COVID-19 pandemic.
According to Hanoi Statistics Department, there were more than 2,500 enterprises in the capital city involved in exporting in 2022.
Financial sector promotes digital transformation in tax and customs processes
The digital transformation of the tax and customs fields has brought positive impacts to people and the business community, according to experts.
At the forum on digital transformation of the tax and customs fields held in Hanoi earlier this week, Can Van Luc, chief economist at the Bank for Investment and Development of Vietnam (BIDV) and member of the National Financial and Monetary Policy Advisory Council, said that now, the taxation sector is relating to 907,000 businesses and about 28 million people.
Meanwhile, the customs involves about 80,000 businesses having import and export activities. Of these, 64,700 businesses have registered to join in the single-window public service system relating to import and export activities.
Luc said the tax and customs reform and management strategy has been issued with many specific solutions.
For electronic invoices, the tax sector has deployed them for more than one year, achieving great success. Meanwhile, the customs sector has developed digitisation to have the national public service portal at levels 3 and 4, Luc said.
According to the Ministry of Finance, the electronic tax declaration system has been deployed at all tax departments of all 63 provinces and cities. Over 99% of businesses use electronic tax declaration, payment, and refund. In the field of customs, 250 administrative procedures are carried out via the national single window.
Dang Ngoc Minh, Deputy Director of the General Department of Taxation, said the taxation has been implementing many projects to apply information technology in tax management and comprehensive digital transformation of this sector.
The representative of the General Department of Customs also said that the customs will continue to improve the customs legal system to modernise the customs procedure system in line with international commitments, and meet the requirements of digital transformation.
The customs procedure system will be re-designed to build a digital customs model following the digital Government model and Smart Customs with increasing levels of digitisation and automation.
By 2025, the customs strives for all customs procedures to be digitised; and 95% of documents in customs records are converted to digital data.
Nguyen Thi Cuc, Chairwoman of the Vietnam Tax Consulting Association, said that the most successful performance in the digital transformation of the taxation is the implementation of electronic invoices. The electronic invoices have saved costs for society in many aspects.
Regarding the customs, according to Cuc, Vietnam has well developed an application of the Internet for the inspection of import and export goods.
She expects that in the near future, citizen identification numbers will be used in carrying out tax and customs-related procedures for citizens. This number will be used for taxes, customs, and social insurance. That is digitisation, both beneficial to the people and society, towards e-Government.
Nguyen Bac Ha, head of VCCI’s Membership and Training Department, said that the national digital transformation process under the National digital transformation programme to 2025, with a view to 2030 approved by the Prime Minister, has achieved good results. For the Ministry of Finance, the digital transformation in the fields of tax and customs has also achieved important initial results.
However, the VCCI representative said that the digital transformation still requires continuous movement and transformation from the central government to local authorities, synchronous technical facilities along with a basic legal foundation.
Luc said that the tax and customs sectors are doing relatively well, but they also need more automation. In addition, they need to consider suitable technology and investment in technology.
Green economy key for sustainable growth
Promoting green economic initiatives is a matter that Vietnam and many international organisations are focusing on with the aim of reducing greenhouse gas (GHG) emissions by at least 55% by 2025 and become carbon neutral by 2050.
At the Green Economy Forum (GEF) 2023 held in Hanoi recently, the Government welcomed and supported important strategies and initiatives of the European Union (EU) in strengthening cooperation among the business communities to achieve green agreements, as well as maritime economy and digital economy strategies.
Prime Minister Pham Minh Chinh underlined that Vietnam and the EU shared the new vision, new mindset, new determination and drastic actions for green growth and green development.
Vietnam is focusing on speeding up three strategic breakthroughs in institutions, infrastructure and human resources, promoting growth on the foundation of technology and innovation, he said.
Vietnam has been one of the four signatories of the political declaration on the establishment of the Just Energy Transition Partnership (JETP) with G7 countries and international partners, including the EU.
With its abundant natural resources of wind energy and solar power, Vietnam is ready to share its potential and strengths, and cooperate with EU partners in promoting green energy transition and developing renewable energy, and green hydrogen, said the PM.
Meanwhile, EU Ambassador to Vietnam Julien Guerrier said that thanks to policies and solutions to support green economy development and climate change response, last year, GHG emissions in the EU dropped about 2.5%, while the union’s economic growth increased by 3.5%. This is evidence that the successful reduction of greenhouse gas emissions is possible in parallel with maintaining global economic growth, he stated.
He said that Vietnam, with its net-zero emission commitment by 2050, shares the same interest with the EU in switching to a green and low-carbon economy, which helps shape the bilateral partnership.
Through the JETP mechanism, the EU will provide significant resources to Vietnam to accompany the country, he said.
Guerrier underlined that the pursuit of sustainable growth in the economy brings both opportunities and challenges. It will open new pathways for innovation, job creation and economic growth, enabling the building of a stronger and more inclusive society. On the other hand, it reassesses current systems and thinking to shift to sustainable production and consumption models.
By promoting collaboration between public authorities and the private sector, the EU and Vietnam can unlock the potential to create a greener, more prosperous future, he held.
The ambassador also stressed the need for the business communities of both sides to discuss measures to take full advantage of the EU-Vietnam Free Trade Agreement (EVFTA), thus strengthening the bilateral trade partnership.
He advised European businesses to consider increasing investment and establishing research centres in Vietnam in new fields such as renewable energy, digital transformation, smart agriculture, and low emission industry. This will help to contribute to turning Vietnam into an innovation centre and a regional research hub in the field of green transformation, and forming a green hydrogen value chain in Vietnam.
Exporters pin hope on traditional Vietnamese food
The processing of traditional Vietnamese food products meeting international quality standards is a new direction chosen by many companies in a bid to boost exports.
Vietnamese cuisine is widely appreciated for its delicious flavours and high nutritional value. Exporting these products, therefore, has become a priority for Vietnamese businesses to expand their markets overseas.
Mikko-Huong Xua premix products by joint venture company Intermix, which is well-known among Vietnamese consumers, are now available in more than 30 countries worldwide. They have gained popularity and high sales in markets such as the US, Canada, Australia, Europe, and Asia.
Meanwhile, Song Huong Foods, a company with strengths in food production and preservation technology, opted for the export of pre-processed traditional dishes, with their successful products including various types of fish sauces and traditional cakes.
According to CTWS Group, which imports and distributes Song Huong Foods products, such exports marked the first time that a wide range of Vietnamese specialty products fully certified for quality and safety has reached the hands of Vietnamese people in the US. Previously, such types of goods were only brought into the nation in small quantities as personal gifts without strict quality assurance.
The key to successfully exporting traditional food lies in not only their taste but also their quality, food safety, and convenience for consumers.
Intermix CEO Huynh Kim Chi noted that to serve demanding markets, the production lines must be equipped with modern and closed technologies. In addition, Intermix has a Research and Development (R&D) team to create its specialised and convenient pre-mix products.
CEO of Song Huong Foods Nguyen Le Quoc Tuan said that it took the company more than six months to conduct all the tests on input materials and complete FDA certification procedures to introduce a wide range of northern, central, and southern-style fish sauces and traditional cakes to 32 states of the US, serving the Vietnamese communities there.
Regarding the potential for the development of traditional Vietnamese food products on the international markets, CTWS Group assessed that Vietnam has a competitive edge from its raw materials, especially in the fish sauce sector. What businesses need to do now is to seek and develop more of the kind to serve Vietnamese expatriates, promote Vietnamese culinary culture, and expand export markets.
Experts and economists seek ways to ensure fuel security
Early this week, oil specialists and economists convened at a seminar to deliberate on the importance of maintaining fuel security for electricity generation in Vietnam, given the diminishing yields from national gas fields.
During the event, organised by Petrovietnam and PV Gas in Ba Ria-Vung Tau province, Huynh Quang Hai, Deputy General Director of PV GAS, underscored the annual decline of approximately 10% in domestic gas production, attributing it to the prolonged exploitation of gas fields.
This downward trend is anticipated to lead to a domestic gas deficit for future electricity production.
The seminar revealed that the annual requirement for domestic gas in electricity generation hovers between 5 and 6 billion cubic metres. Presently, only about 3 billion cubic metres are being supplied to power stations. This shortfall necessitates the temporary cessation of gas supply to other consumers when the power generation system demands higher gas capacities.
The shortage of gas for electricity production in Vietnam is exacerbated by the delay in the operation of projects like the Nhon Trach 3 & 4 power plant, which has a gas demand of about one million tonnes per year (equivalent to 1.2 billion cubic metres of gas per year). Meanwhile, the Long An 1 and 2 gas power project has also only recently received the Ministry of Industry and Trade’s appraisal of its basic design.
He mentioned that importing liquefied natural gas (LNG) to compensate for the shortage of domestic gas was considered an inevitable alternative.
In addition, the absence of an LNG price policy mechanism and the lack of a defined authority to approve LNG gas purchase contracts are key obstacles in developing imported LNG projects. Additionally, the transportation and storage costs associated with LNG imports also pose further challenges.
In the past, domestic gas development in Vietnam, such as the Nam Con Son gas field, benefited from clear regulations on gas prices and offtake contracts. This provided a solid foundation for the development of domestic gas fields. However, the situation is different for imported LNG. The pricing mechanism for imported LNG is not yet established, making it difficult to determine the economic viability of LNG-based power projects.
Moreover, importing LNG involves additional costs, including transportation expenses to bring LNG from abroad to Vietnam and the infrastructure required to store LNG at extremely low temperatures.
Taking an example, the Nhon Trach 3&4 gas power project has encountered challenges in negotiating a power purchase agreement (PPA) between PV Power and Vietnam Electricity Group (EVN). One of the key issues is related to the commitment of annual power purchase contracts from EVN.
EVN has also reported to the Ministry of Industry and Trade that the price of LNG is currently 1.5 times higher than the price of domestic gas. This significant price difference makes the cost of generating electricity from imported LNG too high. As a result, it becomes difficult for the Nhon Trach 3 & 4 project to operate in the electricity market. Moreover, the high cost of imported LNG also affects EVN’s overall electricity purchase plans, creating challenges for financial balance.
According to Huynh Quang Hai, PV GAS has taken steps to meet the demand for LNG for clean electricity production in Vietnam. They have already put phase 1 of the Thi Vai LNG warehouse into operation in Ba Ria-Vung Tau, with a capacity of 1 million tonnes.
PV GAS is now preparing to implement phase 2 of the project, which aims to increase the capacity of the Thi Vai LNG warehouse to 3 million tonnes. This expansion is intended to align with the demand for LNG gas required for clean electricity production as specified in the approved Power Development Plan VIII.
Also at the seminar, Dr. Ngo Tri Long, former Director of the Ministry of Finance’s Price and Market Research Institute, highlighted the need for the Government to address several issues related to domestic LNG gas power projects. Completing policies and incentive mechanisms was the main solution. These measures should include tax incentive policies, loan support mechanisms, and clear regulations on the approval and construction process of LNG projects.
Investors of the Nhon Trach 3 & 4 power plant project stated that this project was the first LNG power project in the country and there was no precedent for an output offtake contract for this type of project. They believed that certain measures should be taken to promote investment in LNG power projects in Vietnam, such as the early issuance of a power generation price framework specifically for LNG projects.
Many experts suggested that the involvement of State management agencies was crucial. These agencies can play a significant role by providing clear policy mechanisms to promote LNG consumption in Vietnam.
Companies must better study market, prepare for price surges
More should be done by rice exporters to understand the market and minimise risks, said industry insiders and experts.
Despite Vietnamese rice making history by reaching 638 USD per tonne of 5% broken rice, the highest level recorded, according to the Vietnam Food Association (VFA), rice exporters’ profit margin has been getting ever thinner, with some reporting losses.
A major contributor, according to a spokesperson from the VFA, is how exporters leave themselves vulnerable to price fluctuations.
Many exporters choose to sign contracts with foreign buyers first and look for supply later. Once prices surge in the domestic market, they either have to negotiate or accept the losses. Another factor was how quickly domestic prices react to global prices, which has left exporters unprepared and unable to respond.
Renegotiation often takes time and adds extra costs, further hurting exporters, especially those with limited financial capacity.
As of mid-November, the asking price for rice in the Mekong Delta has reached 13,200-14,400 VND per kilogramme, forcing exporters to compete with each other to fulfil their contractual obligations.
Experts said at this price level, they must sell at 700 USD per tonne to make a profit, significantly higher than what the global market is offering to buy. At these elevated prices, exporters also find it difficult to engage in new contracts.
Dinh Minh Tam, Director of Co May Co., a rice export company based in the Mekong Delta province of Dong Thap, said exporters must better position themselves operationally and financially to minimise the potential damage of price surges.
He said a large factor leading to the current situation was a lack of quality market information and failure to closely observe price fluctuations.
To make matters worse, some cornered companies resorted to unfair business practices that caused market disorder, price manipulation, commercial fraud, contractual non-compliance and a decrease in quality. It often resulted in higher losses across the entire industry and damaged the reputation of Vietnamese products in foreign markets, hindering the industry’s development in the long run.
Weakening demand and oversupply have also thinned the industry’s profit margin as the market is approaching saturation point. According to a recent report by FiinGroup, a market company based in Vietnam, the industry’s profit margin has decreased from 17% in 2021 to 13.5% in 2022. Rising input costs for fertilizers, seeds and machinery also cut into profit.
It has resulted in a significant number of companies withdrawing from the market and weaker appeal for the agriculture industry as a whole. Based on a scoring model by the company, it’s predicted that an increasing number of companies will face high to very high levels of risk, 13% in 2023 in comparison to 10% in 2022.
Data from the Ministry of Agriculture and Rural Development (MARD) showed in the first 10 months of 2023, the export price reached 558 USD per tonne, a 15.3% increase compared to the same period last year. Rice export turnover reached 4 billion USD, a 35% increase in value compared to the same period in 2022.
Vietnamese, Chinese provinces beef up cross-border trade
A conference on trade exchange between Lao Cai province of Vietnam and Yunnan province of China was held in Lao Cai city on November 10 as part of the 2023 Vietnam-China International Fair.
The event gathered representatives from 167 Vietnamese firms, including 62 enterprises of Lao Cai, and 80 Chinese businesses.
In his opening remarks, Director of the Lao Cai Department of Industry and Trade Nguyen Truong Giang described Lao Cai as as a “bridge” and a “gateway” for Vietnam and ASEAN countries to get access to the markets of Yunnan province and the southwestern region of China. He also highlighted Lao Cai’s advantages as the province boasts a diverse system of border gates and a convenient network of logistics centres.
He said imports and exports via the two provinces’ border gates posted an average annual growth rate of over 20% between 2010 and 2019. During the 2020-2023 period, due to the impact of the COVID-19 pandemic, the import-export activities have slowed down. However, customs clearance operations at the two sides’ border gates have been well maintained, with their annual trade value averaging around 3.5 billion USD.
Giang affirmed Lao Cai’s commitments to tackle hurdles facing enterprises, ensure order and security, and create a favourable business climate towards becoming an attractive destination for import-export firms and investors in Vietnam and from abroad.
Deputy Director of Yunnan’s Department of Commerce Hao Yishan stated that the province is ready to collaborate with Vietnamese authorities and business community to implement the important consensus reached by Vietnamese and Chinese leaders, strengthen bilateral economic, trade, and industrial exchanges, and create a large market and development opportunities for firms from both sides.
Hao proposed the two sides encourage business cooperation in industrial and supply chain development, and the expansion of industrial clusters.
Data showed that trade between Vietnam and Yunnan reached only 3.2 billion USD last year, representing a modest proportion in the overall Vietnam-China trade volume, meaning that there is tremendous room for further growth.
Le Hoang Tai, Deputy Director of the Trade Promotion Agency under the Vietnamese Ministry of Industry and Trade, recommended coordinating the implementation of a memorandum of understanding signed between the Yunnan Department of Commerce and the agency and the industry and trade departments of 12 Vietnamese localities by developing specific plans and organising trade promotion activities.
Seminar seeks opportunities for Vietnam’s commodity trade expansion to Northeast Asia
Opportunities for expanding commodity trade to the still untapped 1.6-billion-people Northeast Asian market were a highlight of a seminar held on November 10 in the Mekong Delta city of Can Tho.
As heard at the event that gave information on demand, trends, and regulations in the East Asian farm produce market, Northeast Asia boasts significant purchasing power and immense potential for economic and commercial development. In addition to the three major trading partners – China, Japan, and the Republic of Korea (RoK), other important markets of Vietnam in this region include Taiwan (China), Mongolia, and Hong Kong (China).
Nguyen Nhu Tiep, Director of the Ministry of Agriculture and Rural Development (MARD)’s Agro-Forestry-Fisheries Quality Assurance Department, acknowledged that East Asia is a market of both traditional and strategic significance to Vietnam, with East Asia standing out as a large export market of the nation, trailing only behind the EU and the US.
According to Nguyen Duy Kien from the Asia-Africa Market Department under the Ministry of Industry and Trade, Vietnam’s total import-export turnover with the Northeast Asia market reached 350.2 billion USD last year, accounting for 48% of its total global trade. In the first nine months of 2023 alone, the figures were 236 billion USD and 47.5%, respectively.
Also during the January – September period, Vietnam’s export structure to the region covered processing-manufacturing goods, construction materials, fuel, minerals, and agro-forestry-fishery products.
Addressing challenges faced by Vietnamese exports to the area, Kien underscored an increase in transportation costs, currency policies, tightening expenditures, and new import standards imposed by China, the RoK, and Japan.
In response, he advised localities and businesses adapt to new consumer trends and standards in the export markets, maintain market share by maximising the benefits of reduced tariffs brought about by free trade agreements (FTA), step up trade promotion, push products into large distribution systems, and capitalise on cross-border e-commerce.
HCM City students win GBA Business Challenge 2023
Students from Hồ Chí Minh City University of Technology (HUT) have been honoured as champions of a start-up competition, the GBA Business Challenge, convincing the panel of judges with their innovative business idea aimed to save the environment and highlight Vietnamese identity.
The winning team stood out with its business initiative ENSOVER: Sustainable Water Hyacinth Paper. The initiative transforms the invasive water hyacinth into high quality paper, turning an environmental issue into a sustainable solution.
Embodying the motto “From Waste to Great”, the champion aims to highlight Vietnamese identity through innovative solutions to local environmental challenges, fostering national pride and showcasing Vietnamese ingenuity. This effort reflects Việt Nam’s commitment to sustainability and resilience.
“Participating in the GBA Business Challenge provided us not only with financial support and a capacity-building programme, but also a chance to challenge ourselves. We experienced the challenges and pressures of a real business environment. We have also gained a wealth of knowledge which has boosted our self-confidence and entrepreneurial spirit,” said a representative of the champion team.
The first runner-up was AGROWISE, a group of students from Đà Nẵng University of Economics and Vietnam-Korea University of Information and Communication Technology. The AGROWISE team persuaded the panel of judges with their business idea focusing on Internet of Things (IoT) technology. The technology empowers farmers to yield abundant crops while preserving valuable natural resources.
The second-runner up belonged to the MEDIFIND team which was comprised of students from Hồ Chí Minh City University of Economics and HUT. The group offered a comprehensive App which ensures the safe usage of antibiotics by meticulously analysing ingredient lists and providing decisive advice and warnings.
Launched by the Germany Business Association (GBA) in 2020, the GBA Business Challenge aims to support local young talents who have promising, forward-thinking ideas, helping them transform their visions as well as their initiatives into viable businesses.
The competition provides participants with entrepreneurial tools, real-life business experience, and a starting fund. The competition has attracted over 200 diverse business concepts with the potential to positively impact society, the environment, and people in the long term.
This year’s competition theme focused on addressing issues related to social, environmental, or sustainable development. Out of 50 startups that underwent a rigorous six-month training and evaluation process, five teams from various universities across Việt Nam reached the top ranks of the competition.
These teams presented their innovative solutions to compete for a prize of VNĐ350 million and a 12-month coaching programme.
The coaching programme is facilitated by experienced leaders and experts from the German business community in Việt Nam and professors from the Vietnamese-Germany University (VGU) and the German Academy Exchange Agency (DAAD).
Việt Nam accelerates trade promotion to the UK
Việt Nam has been accelerating trade promotion in the United Kingdom – the world’s fifth-largest economy with US$700 billion worth of import demand per year in the context of Vietnamese goods having more competitors.
Lately, in September, the Vietnamese Trade Office in the UK supported five Vietnamese businesses to introduce food and beverage products at the Specialty and Fine Food Fair 2023 in London.
During the fair, these firms advertised specialties from three regions such as Phú Thọ green tea, San Tuyết tea, cinnamon, anise, Shiitake mushrooms, Séng Cù and Ông Cua ST25 rice, dried-toasted coconut rice, and frozen seafood.
They were also assisted by the Ministry of Industry and Trade (MoIT)’s Việt Nam Trade Promotion Agency and the Việt Nam Trade Office in the UK in exploring new business opportunities in the market and finding new trade partners.
Since 2021, the MoIT has coordinated with other parties to better introduce Việt Nam’s major commodities such as pepper, cashew, and coconut besides other goods with geographical indication certification such as Tân Cương tea, Thanh Hà litchi, and Bình Thuận dragon fruit to businesses and customers in international markets, including those in the UK.
Tạ Hoàng Lan, deputy head of the Trade Promotion Capacity Development Department under the Việt Nam Trade Promotion Agency, said that her agency would increase promotion activities in the UK to seek trade cooperation opportunities, provide market information to enterprises, and connect businesses between the two sides.
Promotions would also be enhanced for developing national brands and brands of products of Việt Nam’s strength, she said.
Meanwhile, to support businesses in promoting trade and effectively exploiting the UK-Việt Nam Free Trade Agreement (UKVFTA), the Việt Nam Trade Office in the UK has been building networks with the British business community and Vietnamese businesses in the UK so that it could introduce partners for Vietnamese businesses.
The office has been finding out and providing Vietnamese businesses with updated information on product quality standards and import regulations into the UK.
Bilateral trade between Việt Nam and the UK reached $6.8 billion in 2022. Of which, Việt Nam’s exports to the market hit $6.1 billion while its imports topped $700 million.
Over the past eight months of 2023, two-way trade fetched $4.62 billion with nearly $4.1 billion from Vietnamese exports.
Việt Nam ranked 23rd among the largest exporters to the UK in the past three years since UKVFTA took effect. Typically, Vietnamese exports of industrial goods excluding iron, steel, and metals to the market accounted for over 40 per cent of its total turnover.
ESG: an investment, an asset for long-term values
Enterprises should consider Environment, Social and Governance (ESG) practices as an investment for longer-term payoffs rather than a liability as sustainability is taking centre stage, experts said.
Speaking at the discussion session of the seminar themed “ESG Commitment: We walk the talk” held by Việt Nam News on Thursday, Trịnh Thị Hương, Deputy Director of the Enterprise Development Agency under the Ministry of Planning and Investment (MPI), said that ESG has become increasingly popular in Việt Nam in recent years with a number of enterprises beginning their journeys with ESG practices integrated into their operation and reporting.
Most pioneers in embracing ESG were large scale, foreign invested, listed or export companies, while sustainability remained strange to micro, small and medium sized enterprises which accounted for 97.8 per cent of firms in Việt Nam.
Hương said greater attention must be paid to promoting ESG practices for SMEs.
She cited findings of a survey by the MPI that 83 per cent were aware that ESG was vital and would play an important role in leveraging the brand, prestige and competitiveness of enterprises.
Addressing limitations of SMEs, including the shortage of capital, the lack of science and technology, weak governance capacity, limited access to capital and market information, Hương said enterprises remained confused when it came to ESG because their understanding of ESG practices was limited.
Besides, the shortage of resources for implementing ESG, including financial and human resources, posed a significant challenge to SMEs, she said.
“ESG should not be considered a cost burden but an investment for long-term benefits and new values,” Hương said, adding that embracing sustainability would help enterprises meet market requirements and have better opportunities to expand markets.
Phạm Hoàng Hải, Head of Partnership Department, Việt Nam Business Council for Sustainable Development, said more than a decade ago, the story was about corporate social responsibility and sustainable development, but now ESG moved towards centre stage, providing a tool for sustainability assessment.
Hải pointed out a problem that enterprises still did not have a complete and thorough understanding of ESG, making it a challenge for enterprises, not only SMEs but also big ones.
He said greater support and instructions must be provided to enterprises so that they could integrate ESG in their operation.
Lê Thị Hồng Nhi, Head of Communications and Corporate Affairs of Unilever Việt Nam, said ESG practices were not a cost but an opportunity.
Highlighting that no enterprise could develop prosperously in an environment which lacks sustainability, Nhi said that going sustainable became vital for enterprises. ESG would bring long-term benefits, including business opportunities and consolidated consumer confidence, she said.
As a pioneer in ESG practices in Việt Nam, Unilever has taken drastic steps towards sustainable development, including emission reduction in the company’s operation and its entire supply chain, she stressed. With more than 500 partners, Unilever was making an effort to change the leadership mindset within its supply chain towards green growth and net zero.
Hương from MPI stressed the importance of a mechanism which would encourage enterprise to move towards sustainable development.
Koen Soenens, General Sales and Marketing Director of DEEP C Industrial Zones, which was among first embracing eco-industrial parks in Việt Nam, said ESG practices significantly help attract quality foreign direct investment.
“In the case of DEEP C, ESG enables us to attract a different level of investors who align with DEEP C in terms of sustainability and ESG,” he said.
He expected Việt Nam’s legal framework would be further improved together with additional effort in terms of improving infrastructure systems and workforce training, to remain attractive to investors and climb the value chain.
Emphasising that improving the investment climate and policies remained the first priority of the Vietnamese Government, Hương said that the Government would accompany enterprises in ESG journey. She also called on enterprises to take actions towards ESG, adding that ESG is not a liability but an asset.
“There are challenges. There are opportunities. However, challenges will turn into opportunities with ESG practices,’’ said Võ Trí Thành, Director of the Institute for Brand and Competitive Strategy. Many enterprises are embarking on their ESG journey with green and compassionate values.
Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes
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