VIETNAM BUSINESS NEWS NOVEMBER 25/2023

Vietnam’s textile, apparel exports to top 40 billion USD in 2023: VITAS

Vietnam Textile and Apparel Association (VITAS) on November 23 announced that Vietnam’s textile and apparel exports are estimated to top 40 billion USD, about 9% less than that of last year.

Speaking at a press conference announcing a coming conference reviewing the association’s performance in 2023, VITAS Chairman Vu Duc Giang said that this year, Vietnam’s textile and apparel industry sees many major challenges including the global impact of the COVID-19 pandemic and large inventory due to falling demand.

“Despite the decline in exports, the export turnover is still considered a breakthrough demonstrating great efforts of the business community,” Giang said, adding that in 2023, Vietnamese textile and garment products entered 104 countries and territories – a record number of markets.

According to VITAS, the four biggest importers of Vietnamese textiles and garment in 2023 are the US with a turnover of over 11 billion USD, Japan about 3 billion USD, the Republic of Korea 2.43 billion USD, and the EU 2.9 billion USD.

Vietnamese producers have been making efforts to diversify products for export with 36 types of products.

Diversifying markets, products, customers, and partners is a way for Vietnam’s textile and garment industry to reduce its reliance on large markets. New markets have started importing products from Vietnam, helping to affirm Vietnam’s position in the global market, Giang emphasised.

Producers advised to enhance coffee quality, competitiveness

Despite a high export revenue recorded so far this year, the coffee sector is advised to enhance the quality and competitiveness of their products to better conquer the world market.

Statistics from the General Department of Vietnam Customs showed that in the first 11 months of this year, Vietnam exported 1.36 million tonnes of coffee for 3.5 billion USD, up 3.4% year on year.

However, the export volume is decreasing in the recent two months, mostly due to low inventories.

Vietnam has the sixth largest coffee farming area in the world but the second biggest output thanks to high yields. However, the supply is dropping although Vietnam is entering a new harvesting season, leading to a hike in prices.

Do Ha Nam, Vice Chairman of the Vietnam Coffee-Cocoa Association (Vicofa), said that the coffee price will further increase if farmers pay greater attention to enhancing the quality of material coffee. He advised farmers to concentrate on the harvesting stage and ensure the traceability of their products to meet export requirements, especially in the European market, the largest market of Vietnamese coffee.

Nam noted that among the 720,000 hectares of coffee across the country, only 185,000 hectares have received sustainable production certificates of different kinds, accounting for only a small part of the total area.

He underlined the need to manage the farming areas and farming area codes to avoid violations in anti-deforestation regulations.

Meanwhile, Nguyen Quang Binh, Editor-in-Chief of the Vietnam coffee magazine, said that in order to secure stable sale prices, Vietnamese coffee must meet the requirements of buyers, especially those in Europe where many new import regulations have been introduced.

Italy is Vietnam’s largest consumer of tuna in European Union

Italy has emerged as Vietnam’s largest tuna export market in the European Union, according to the General Department of Vietnam Customs.

Statistics show tuna exports to Germany, the Netherlands and Italy that are the three leading import markets of the bloc, witnessed changes in October. While tuna exports to Germany and the Netherlands decreased considerably, those to Italy increased 30 times, making it the largest Vietnamese tuna importer.

The value of tuna exports to the EU in October reached just more than US$15 million, down 19% year on year, but the 10-month export value rose 1% to more than US$143 million.

Meanwhile, tuna exports to the United States and Canada climbed 6% in October after experiencing a fall in previous months. The export value of the tuna products to Chile, the Philippines and the Republic of Korea also skyrocketed by 406%, 116% and 402% respectively.

Notably, the Republic of Korea is currently among the top 15 markets importing the most tuna from Vietnam.

Vietnam raked in over US$76 million from tuna exports in October, down 0.5% year on year. Processed and canned tuna products were preferred by global consumers, with the export of frozen steamed tuna increasing by 24%.

Businesses required to meet sanitary, phytosanitary standards by importers

Local businesses are required to apply VietGAP and GlobalGAP standards in production of agricultural products to meet sanitary and phytosanitary regulations by importers to compete with similar products from other countries, said experts.

Experts made recommendations at a seminar held on November 23 to examine commitments relating to food safety, plant and animal quarantine in the Free Trade Agreement signed between Vietnam and member countries of the Regional Comprehensive Economic Partnership (RCEP).
  
Addressing the event, Ngo Xuan Nam, deputy director of the Vietnam Sanitary and Phytosanitary Notification Authority and Enquiry Point (SPS Vietnam), emphasised that meeting Sanitary and Phytosanitary Standards (SPS) set by foreign importers is mandatory for local firms, noting violation of these rules will cause damage to the entire industry and Vietnamese agricultural brands in the international market.

According to the official, Vietnam has joined 19 bilateral and multilateral trade agreements with several new-generation FTAs such as RCEP, setting forth SPS regulations which the country must abide by.

Every month the Vietnam SPS Office receives about 100 notices on changes to SPS measures concerning pesticide residue levels, veterinary medicine, and other strict regulations on food safety and hygiene, Nam added.

Currently, China is one of the key markets for Vietnamese agricultural exports. It recently issued stricter regulations on food safety, and animal and plant quarantine for imported products.

Regarding the Chinese market, Lo Xuan Quyet, chief representative of the Vietnam Trade Promotion Office in Hangzhou, said Vietnam is one of China’s top 10 largest exporters of agricultural products, although its farm produce only accounts for about 2.6% of China’s total agricultural import value.

As for fruit and vegetables, Vietnam is one of the largest suppliers of the products to , behind Thailand and Chile.

Quyet stressed that there remains plenty of room for Vietnamese seafood, fruit, and vegetable products in the Chinese market. Most notably, durian is expected to take the lead among Vietnamese fruits exported to the Chinese market in the future.

Quyet recommended that Vietnamese businesses take full advantage of favourable factors such as geographical location, reasonable production, and transportation costs in a bid to meet the huge demand in the Chinese market.

Moreover, local firms were required to achieve VietGAP and GlobalGAP standards; strengthen management over food safety and hygiene, comply with regulations on quality standards; quarantine testing, packaging, and origin traceability; as well as focusing on brand building to export products to the market in a sustainable manner.

An Giang Province aims to increase rice value, quality

An Giang Province is developing rice production towards enhancing value, establishing linkages among stakeholders, increasing mechanisation, and growing high-quality varieties to meet export requirements.

The Cửu Long (Mekong) Delta province, the second-largest rice producer in the country after neighbouring Kiên Giang Province, benefits from a constant freshwater supply throughout the year from the Tiền and Hậu rivers, tributaries of the Mekong River.

Situated in the delta’s upstream area, the province is seldom affected by saltwater intrusion, enabling most areas to grow three crops annually.

With nearly 640,000 hectares and an annual paddy output of nearly four million tonnes, An Giang’s rice export value exceeds US$250 million per year.

With the support of relevant departments and agencies, more farmers are forming partnerships with companies to cultivate rice under contractual agreements, ensuring stable outlet and selling prices.

The provincial Department of Agriculture and Rural Development, the Province’s Farmers Association, and the Province Co-operative Alliance have signed an agreement with the Lộc Trời Group for rice production from 2024 to 2030.

According to the agreement, the large-scale rice fields planted through collaboration between farmers and the group will cover 139,000 hectares next year and 257,000ha in 2025.

Nguyễn Sĩ Lâm, the department director, said to effectively implement the agreement, the department would facilitate and support the Lộc Trời Group, including its member companies, in rice production in designated areas.

It will assist the group in establishing cooperatives in rice-growing areas, expanding agricultural extension activities, and implementing high-tech agriculture in cooperatives involving the group.

Collaborating with district-level people’s committees, it will guide relevant agencies in facilitating the signing of farm contracts between cooperatives, farmers and Lộc Trời.

It will issue production codes for rice-growing areas linked with the group.

Nguyễn Văn Nhiên, chairman of the Province Farmers Association, reported that the association has encouraged over 40 cooperatives and several cooperative groups to partner with more than 30 companies, ensuring reliable outlets for farmers.

An Giang aims for rice farming areas under stakeholder linkages to constitute 25-28 per cent of its total rice-growing area by 2025.

The province has registered with the Ministry of Agriculture and Rural Development to participate in a project for the sustainable development of one million hectares of high-quality and low-emission rice cultivation associated with green growth in the Mekong Delta.

An Giang’s extensive rice farming area positions it favourably to engage in the project, said Lâm, the department director.

Under the project, the province targets a high-quality rice-growing area of 103,000 hectares by 2025 and 152,000 hectares by 2030.

For the 2023-24 winter-spring crop, localities in the province have registered to grow 20,609 hectares of rice under the project, according to the department.

An Giang is encouraging farmers to adopt environmentally friendly rice-growing models that enhance quality and profits.

The Việt Nam Farmers Association has selected An Giang to participate in a project applying environmentally friendly rice-growing methods. These methods involve reducing chemical usage, employing wet and dry irrigation techniques, and planting flowers around rice fields to attract insects that control brown plant hoppers, the main pest for rice.

The province has taught farmers environment-friendly farming techniques and developed some excellent models.

Trần Thanh Vân in Chợ Mới District’s An Thạnh Trung Commune said: “After learning environmentally friendly farming techniques, I apply them to a 1,000sq.m rice field.”

By using these techniques, he can reduce the quantity of chemical fertilisers by 5-8 kilogrammes compared to traditional farming methods. Besides, the number of irrigation cycles in a rice crop has decreased by two, he said.

He utilises paddy straw and stubble to grow mushrooms and then uses the used paddy straw and stubble to make organic fertilisers, generating an additional income.

Farmers are currently in the autumn-winter rice peak harvest, and are enjoying a bumper crop and high prices.

Nguyễn Thanh Vũ in Thoại Sơn District’s Vĩnh Chánh Commune has harvested 3.9 hectares of IR 50404 rice and achieved a yield of 6.1 tonnes per hectare.

He sold the rice at VNĐ8,900 per kilogramme, earning a profit of around VNĐ27 million (US$1,100) per hectare, he said.

Lâm said the province has 157,000 hectares of rice and harvested more than 50,000 hectares with an average yield of 5.8 tonnes.

Rice from lands without linkages between farmers and companies and guaranteed outlets have been “pre-purchased by traders, providing farmers with a sense of security,” he added.

E-commerce service providers look to promote consumer protection

The Ministry of Industry and Trade will organise an annual e-commerce week later this month to promote e-commerce services and protect consumers’ rights in the Vietnamese market.

The 2023 E-ecommerce Week, the largest of its kind in Vietnam, is scheduled to take place from November 27 to December 3 and will attract the participation of several leading local e-commerce service providers such as TikTokShop, Shopee, Lazada, Tiki, VnPay, ZaloPay, and Viettel Post.

The event will feature numerous activities, including a Vietnam e-commerce development conference, 60 hours of shopping on online platforms in Vietnam, and an e-commerce festival in Hanoi, with a view to protecting consumers’ rights.

As a means of strengthening the management and supervision of e-commerce activities in Vietnam, the E-Commerce and Digital Economy Department under the Ministry of Industry and Trade has deployed a range of comprehensive solutions, including launching communication campaigns, raising the responsibility of e-commerce platforms, applications, and websites, as well as boosting international cooperation in monitoring and managing e-commerce activities.

The E-Commerce and Digital Economy Department is currently working with the General Department of Market Management to implement a project on combating counterfeit goods and protecting consumers in e-commerce until 2025. They are therefore working on a plan to build a centralised database system capable of managing and monitoring e-commerce activities in the country.

Most notably, the E-Commerce and Digital Economy Department is now building a digital ecosystem which can protect consumers in e-commerce, said Nguyen Thi Minh Huyen, deputy director of the department.

“We believe that with the application of digital technology, the management and supervision of e-commerce activities will be increasingly promoted, helping to ensure consumer trust in e-commerce,” stated Huyen.

Nguyen Quynh Anh, deputy head of the National Competition Commission under the Ministry of Industry and Trade, affirmed that the commission would aim to protect consumers before, during, and after purchases of products online, citing new provisions set out in the 2023 Law on protection of consumer rights that focuses on the responsibility of e-commerce platforms and the role of key opinion leaders (KoL).

“We still expect people to be smart consumers, but to make smart shopping decisions, consumers must be provided with enough information. In the upcoming draft decree, we will require businesses to provide consumers with full information about the product, payment, and delivery as well as product return,” said Anh.

Digital tech helps accelerate rural growth

Technology plays a vital role in fuelling economic growth. Investments in broadband networks and other ICT infrastructure help enterprises improve production efficiency, create new business models and enhance product quality.

Built along rivers and surrounded by mountains, the town of Heshun is located in Tengchong City about 650 kilometres west of the provincial capital, Kunming. Its history stretches back more than 600 years. During the Ming era, it was established as a trading and military outpost to fortify the dynasty’s presence when Yunnan was just a distant frontier.

But Heshun’s long history has not turned it into a mere cultural relic. Instead, the town has embraced digital technology by combining the ancient with the new – in unexpected ways.

Heshun is fully covered by a 5G network. A high-speed broadband network enables visitors to access better services, more quickly and conveniently. Just as important, full 5G coverage creates the infrastructure needed for Big Data analytics, allowing all the connected objects in the Internet of Things (IoT) to send data to the intelligent platform for analysis.

That yields insights that can make tourists’ lives easier – for example, by assigning a visitor’s car to an optimally situated parking place that saves the driver and his family a long walk. First-time visitors don’t have to worry about getting lost. Using a WeChat mini programme, they can find their way around, buy tickets, locate restaurants, catch buses and book hotels, among other things. City’s management can receive alarms from 50 points throughout the town to respond to any emergency in real time. Whether you’ve lost your phone – or lost contact with your family member – help is just one click away.

Even the physical infrastructure has intelligence built into it. Automatic photo printers allow shutterbugs to scan a QR code and print their best snapshots on site. Benches equipped with solar panels and electric outlets can be used to charge smartphones. Smart water fountains monitor the quality and flow rate of water, ensuring it is both safe to drink and not being wasted. If you’re visiting in July, but want to know what Heshun looks like while blanketed in snow, you can see it vividly rendered with VR and 3D digital animation technology. Heshun’s digital infrastructure also allows it to be equipped with security cameras and a fire monitoring system, playing an important role in the protection of the natural environment and its historically significant sites.

“Tengchong’s tourism industry has unique advantages,” said Chang Zaifei, Deputy Director of the Tengchong Culture and Tourism Bureau. “From January to September 2023, Tengchong received a total of 13.37 million tourists, and achieved a total tourism revenue of 17.1 billion yuan, increases of 22 and 38 per cent respectively year-on-year.

“Taking Heshun as an example, more than 4,000 local residents have increased their income as a result of the new economic opportunities opened up by tourism, which have been created by the buildout of digital infrastructure.”

The latest research from the International Telecommunication Union suggests that a 10 per cent increase in mobile broadband penetration has led to an average increase of 1.5 per cent in real GDP per capita.

Providing the right digital infrastructure could be especially helpful to rural economies. Official government figures show that by the middle of 2023, roughly 60 per cent of China’s rural inhabitants had access to the internet, while the number of broadband users in the countryside was expected to exceed 190 million by the end of this year.

One can see the benefits of this digital build-out in Yunnan, a less-developed, largely rural province in southwestern China. Yunnan’s recipe for success has three key ingredients including ambitious goals, better ICT infrastructure, and a strategic blueprint (drawn up in 2020) to concentrate on industries in which the province has a natural advantage.

In a bid to revitalise rural areas, operators have stepped up the implementation of universal telecommunications services, gradually expanding 5G and fibre connectivity to remote areas. As a digital infrastructure provider, Huawei has contributed to Yunnan’s digital development.

The case study of Heshun Ancient Town shows how digital technology can accelerate rural growth. Building on this success will require efforts to fill digitalisation gaps and bridge the “last mile”, especially in smaller villages.

Shi Yun, General Manager of Baoshan Branch of China Mobile Yunnan told Việt Nam News: “With regard to the future development of 5G technology, I believe that the emergence of new devices will also drive the development of further applications, and this will actually further drive the development of 5G infrastructure. Similar products will be launched to the Chinese market very soon, given the advanced manufacturing capability in China. Vendors such as Huawei and other domestic equipment providers will also follow this path.”

He added that there’s still room for us to improve the 5G smartphone penetration rate. So far, the 5G device penetration rate is not very high.

Hải Phòng remains attractive destination for foreign investors

The northern port city of Hải Phòng has continued to be an attractive destination for foreign investors as it lured nearly US$3.1 billion in foreign investment over the past 10 months of this year, up 68 per cent year-on-year.

The city’s 10-month foreign investment attraction was also 53 per cent higher than its yearly target, said Chief of the Office of the municipal People’s Committee Nguyễn Ngọc Tú.

In September alone, the Hải Phòng Economic Zone Authority (HEZA) granted licences to some foreign-invested projects with a combined investment capital of nearly $1.4 billion.

Among these projects included a $500 million hi-tech biodegradable material factory project being developed by Ecovane Co, a subsidiary of the South Korean SK Group in DEEP C Hải Phòng I Industrial Zone; a BW ready-built factory worth $60 million; a $40-million auto parts manufacturing plant by China’s CCTY Bearing Co and $30 million plant producing valve and plumbing accessories.

Besides newly-invested projects, HEZA also allowed Japan’s Kyocera Document Solutions Inc to pour an additional $237.5 million into its machine and equipment manufacturing plant project, raising the project’s total investment to $425 million.

To attract new investors, Hải Phòng has pooled all possible resources to establish South Hải Phòng Economic Zone and embarked on building new industrial zones as planned, the HEZA director Lê Trung Kiên said.

At the same time, it has also pumped investment into transportation infrastructure, and seaports, along with a system of standard and modern warehouses ready to meet the needs of investors, Kiên said.

The city has been also upgrading the power grids to stably supply electricity for industrial parks and investors, expediting the completion of social housing infrastructure to ensure stable accommodations for workers, and accelerating digital transformation in service of the public and businesses.

In the first half of this year, HEZA has contacted and worked with nearly 500 investors and businesses to provide information on the environment and preferential investment policies, regularly and actively supported enterprises in the process of deploying projects, production, and business activities, contributing to creating safe, friendly and attractive investment environment for investors.

To date, Hải Phòng has lured over 1,000 foreign-invested projects valued at nearly $28 billion, including 708 projects, worth $38.1 billion, in industrial and economic zones.

Boosting supply and demand connection to support development

The Ministry of Industry and Trade (MoIT) has improved the efficiency and quality of connecting supply and demand, as well as cooperation between businesses and localities, making an important and positive contribution to the country’s economic development.

This was heard at a forum on promoting effective connection between supply and demand organised by the MoIT’s Việt Nam Institute of Strategy and Policy for Industry and Trade (VIOIT) in Hà Nội on Thursday.

In a situation where the world was facing many changes, promoting the connection between supply and demand was not only a way to promote economic development but also a necessary direction to build a strong economy, meeting market needs and ensuring sustainable prosperity for the future, said VIOIT deputy director Vũ Quang Hùng.

The connection between supply and demand helped optimise resources and encourage innovation and product development, as well as create cooperation opportunities and enhance competition, he added.

In recent years, in order to connect products with provinces and cities nationwide, the MoIT has organised conferences to connect supply and demand with provinces and cities and support businesses.

Through conferences, businesses interact, exchange and learn from experience; from small and fragmented production activities, through trading activities, connecting supply and demand has contributed to businesses gradually shifting to new approaches to the market.

“These activities help businesses on awareness of how to create brands and packaging, how to grasp consumer tastes and trends, build brands for business and products, especially improving product quality to gain a foothold and compete in the market,” said Đoàn Mạnh Trường, a representative from the MoIT’s Agency for Regional Industry and Trade (ARIT).

The ministry has coordinated with provincial departments of industry and trade to successfully organise 28 typical rural industrial goods exhibitions at regional and national levels in the 2013-2022 period.

Each exhibition has about 350 – 450 standard booths and on average the participation of about 155 – 200 rural industrial enterprises.

The ministry has effectively implemented the project to promote Vietnamese enterprises to participate directly in foreign goods networks. It has organised Việt Nam Weeks in countries around the world, such as France, Thailand, Japan since last year.

It organised the 2023 International Goods Supply Chain Connection event with 1,000 trade connections between 200 reputable Vietnamese export enterprises, mainly agricultural, forestry, and fishery export enterprises, and connected with 150 foreign purchasing and distribution delegations.

Besides the results achieved, the connection between manufacturers and distributors also has difficulties, said Trường. Bringing products to large distributors such as supermarkets still faces certain obstacles, especially for small manufacturing establishments.

Labour shortage still caused difficulties for businesses, especially trained workers. Vocational training for workers had not met the development needs of businesses, he said.

Some businesses have had to narrow their production and business scale and have difficulty in implementing investment schedules in production expansion projects.

Counterfeit goods and poor quality goods are still mixed in the market. The management of price listing and selling at listed prices is mainly carried out in supermarkets, while in markets, the situation of listing prices but not selling at listed prices is still common.

The organisation of Vietnamese goods markets in residential areas is only aimed at sales purposes, but has not yet created a strong impact on the “Vietnamese people prioritise using Vietnamese goods” campaign.

Consumers are greatly affected by advertising through electronic and cross-border electronic platforms, causing confusion for businesses and consumers about product quality and brand, causing loss of trust and endangering the health of consumers.

To promote activities connecting the supply and demand of goods and develop markets to promote the strengths of the provinces, creating opportunities for socio-economic development, the ARIT proposed State management agencies innovate and promote trade promotion; consult and support businesses and production facilities in branding, packaging, brand development, product promotion, combined with the development trend of e-commerce.

The agency also recommended the promotion for the role of bridge, introduction, and co-operation in production and consumption of products between commercial enterprises and producers; introduction of products and goods to participate in the supply chain of distributors, shopping centres, supermarkets, and convenience stores nationwide.

It also proposed management agencies study to change the form of organisation to connect supply and demand, in which the conference to connect supply and demand should have consulting content to support businesses in market development and brand building.

State management agencies must also strengthen market management, have plans to manage prices of essential goods, regularly inspect and control the market to avoid shortages and price fever, promptly detect and handle acts of smuggling, production and trading of counterfeit goods, commercial fraud, speculation, price increases, and illegal profiteering that destabilise the market. 

VND350 billion approved for Quang Binh fishing port
 
The Ministry of Agriculture and Rural Development has approved VND350 billion (USD14.52 million) for implementing a fish port and storm shelter project in the central province of Quang Binh.

The project covers 582,832 square metres in the north of the Gianh River in Quang Phuc Ward in Ba Don Town.Once completed, the project can accommodate between 800-1,000 fishing boats.

The project will also involve investment in mooring buoys, dredging, signalling systems and essential technical infrastructure to serve the mooring area.

Mai Van Minh, director of Quang Binh’s Department of Agriculture and Rural Development, said that the project is aimed at easing the shortage of mooring areas for fishing boats.

Haiphong discounts land lease fee for investors in 2023

Haiphong will discount 30 per cent of the land lease fee for investors investing in projects in Dinh Vu-Cat Hai Economic Zone.

On November 20, Haiphong Economic Zones Management Authority office issued the document guiding the implementation. The policy is being introduced following a prime ministerial decision issued on October 3 on reducing land rental fees in 2023.

The reduction in land use fees will benefit organisations, units, enterprises, households, and individuals who directly lease land from the state under state agency decisions or contracts and make rent payments annually.

Land rent reductions totalled VND3.5 trillion ($149.33 million) last year.

Earlier this year, the Ministry of Finance proposed the prime minister extend the temporary 30 per cent reduction on land use fees throughout 2023 as part of measures to help businesses and individuals overcome the ongoing difficulties.

Dinh Vu – Cat Hai EZ covers a total area of 22,540 hectares and combines many industrial parks, such as VSIP Hai Phong, MP Dinh Vu, Dinh Vu, Trang Due, and Nam Dinh Vu.

Most are operating in electronics manufacturing, vehicle manufacturing, mechanics, chemical, pharmaceuticals, garments and footwear, logistics, and infrastructure.

LG Display Haiphong is the largest foreign-invested project in Dinh Vu – Cat Hai EZ with an investment of $4.64 billion.

HCMC plans to invest VND4,300 billion for road expansion project

HCMC plans to allocate VND4,344 billion from its budget for the renovation and expansion of a 7.2 km section of Vinh Loc Street, spanning Binh Chanh and Binh Tan districts.

Initially, the HCMC People’s Council had passed a resolution to expand a 6-km stretch of Vinh Loc Road within Binh Chanh District, measuring 18 meters in width, with a scheduled project duration from 2016 to 2020. However, the project has remained dormant thus far.

The HCMC Department of Transport has recently submitted a proposal to the municipal People’s Committee, requesting approval to revise the project’s investment policy. According to the proposal, the expansion will cover the section of Vinh Loc Street from Tran Van Giau to Road 2A in Vinh Loc Industrial Park, with an estimated investment of VND4,344 billion.

The increase in investment costs can be attributed to the consolidation of compensation efforts with the road expansion projects, updated construction expenses due to changes in the investment scale, and heightened compensation costs, as explained by the department.

The expanded project will encompass a 7.2 km stretch, stretching 30 meters in width, commencing at Tran Van Giau Street on Provincial Road 10 and ending at Road 2A within Vinh Loc Industrial Park.

Once completed, this project promises to significantly ease traffic flow between Binh Chanh, Binh Tan, and Hoc Mon districts.

Logistics forum to be held in early December

The 2023 Vietnam Logistics Forum (VLF) will take place in Mekong Delta city of Can Tho on December 1 and 2, expected to gather about 500 public leaders and officials as well as some 2,000 businessmen and scholars.

The information was unveiled at a press conference held by the Ministry of Industry and Trade (MoIT)’s Agency of Foreign Trade in Hanoi on November 23.

In its 11th annual edition, the forum, themed “Logistics and Digital Transformation for the Mekong Delta”, is set to feature a field trip to Can Tho’s ports, and logistics centres and firms, a plenary session, and a thematic discussion. It will also see the release of the Viet Nam Logistics Report 2023.

According to Tran Thanh Hai, Deputy Director of the agency, the forum is a tightly connected platform facilitating straightforward dialogues among state management agencies at the central and local levels, associations and businesses operating in the sector.

This year’s edition is organised against the backdrop of several new developments. Notably, the implementation of new free trade agreements (FTAs) such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the EU-Vietnam FTA, the UK-Vietnam FTA, and the Regional Comprehensive Economic Partnership (RCEP) requires businesses to make efforts to improve their competitiveness.

The forum provides enterprises with an opportunity to access accurate information and actively participate in the development of the state’s legal mechanisms and policies related to the logistics industry. Additionally, it assists state management agencies in assessing and authenticating information, enabling them to promptly issue policies that meet the practical requirements of the sector.

Great potential for Vietnamese goods to enter Africa, Middle East

An online workshop discussing measures to further promote the export of potential products to Africa and the Middle East was held by the Ministry of Industry and Trade (MoIT)’s Vietnam Trade Promotion Agency on November 23.

Addressing the event, Nguyen Minh Phuong, head of the West Asia – Africa Office under the MoIT ‘s Department of Asia – Africa Markets noted that Middle East countries must import up to 80% of food and foodstuffs, equivalent to 40 billion USD each year, while African countries also import goods with similar value every year. Notably, the requirements for quality and product design of these markets are not too strict.

Truong Xuan Trung, who is in charge of the Vietnam Trade Office in the United Arab Emirates (UAE), said all Vietnamese goods can be exported to this market if they meet standards, noting that the UAE is also a regional and global transit centre, so there is potential to re-export goods from this market.

According to Trung, Vietnam is the largest exporter of agricultural products to the UAE among ASEAN countries. In the first 10 months of 2023, Vietnam’s export of cashew nuts, rice, fruits and vegetables, and tea increased by 60%, 30.9%, 18% and 15.4%, respectively.

Notably, agricultural products exported to the UAE are not yet subject to taxes, therefore, Vietnamese goods, even without the geographical advantage, can still compete in this market, Trung noted.

Furthermore, the UAE is a member of the Gulf Cooperation Council (GCC), so Vietnamese goods exported to the UAE and re-exported to other GCC countries are not subject to double tax.

Nguyen Duy Hung from the Vietnam Trade Office in Egypt said agricultural products including tea, pepper, cashew nuts, coconut rice, coffee, and seafood are the main exports of Vietnam to Egypt. However, these products are facing fierce competition from similar goods from other countries.

A representative of the Vietnam Trade Office in Nigeria emphasised that as the most populous country in Africa and the fastest-growing consumer market in the world, Nigeria is a potential market for Vietnamese goods. The country’s consumption growth is predicted to surge by 150% to 603 billion USD in 2030 from 240 billion USD in 2023. Nigeria is also forecast to be the world’s largest rice importer in 2024 with a total volume of about 2.1 million tonnes.

Speakers advised domestic exporters to be cautious in trade transactions with partners in Africa and the Middle East, saying that the risk in payment is the most important issue to pay heed to.
Businesses should choose a safe payment method such as a letter of credit (L/C) to avoid fraud, they said.

Draft plan on fishing port, storm shelter system under discussion

The verification council for a plan on the system of fishing ports and storm shelters for fishing vessels for the 2021 – 2030 period, with a vision to 2050, convened a meeting in Hanoi on November 23 under the chair of Deputy Prime Minister Tran Luu Quang.

According to the draft plan, there will be 173 fishing ports nationwide by 2030. The territorial waters off the central coast, from Quang Tri to Binh Thuan provinces, will accommodate the biggest number of fishing ports with 82 facilities, followed by the Gulf of Tonkin 45, the sea area off the southeastern region 33, and that off the southwest 13.

By 2030, Vietnam will have 160 storm shelters, comprising 30 at the regional level and 130 at the provincial level, to serve more than 90,000 fishing vessels. The territorial waters off the central region will also be home to the most shelters, 73. The facilities for the Gulf of Tonkin, the southeastern, and the southwestern sea regions will number 47, 24, and 16, respectively.

The number of fishing ports nationwide will be raised to 180 by 2050.

During 2021 – 2025, priority will be given to developing infrastructure and services at fishing ports in major fishery hubs, and building regional-level storm shelters, according to the draft plan.

The Ministry of Agriculture and Rural Development (MARD) estimated that nearly 58 trillion VND (nearly 2.4 billion USD) will be needed for developing essential infrastructure of fishing ports and storm shelters by 2030, including more than 18 trillion VND for the 2021 – 2025 period.

Discussing the draft, members of the verification council said fishing ports and storm shelters are important parts of fishery and socio-economic infrastructure, and investment in these facilities is necessary for effective and sustainable exploitation of aquatic resources.

The plan aims to complete and modernise infrastructure to meet the fishery sector’s logistics demand, guarantee food safety, reduce post-fishing losses, and ensure safety for vessels and fishermen. It will also help with fishery management, international integration, climate change adaptation, environmental and marine ecosystem protection, and defence – security safeguarding, they said.

In particular, as importing markets have been tightening rules on food safety and seafood traceability, exporting countries like Vietnam have to ensure the reliability of its entire fishery exploitation, importing, processing, and exporting process, council members noted.

Deputy PM Tran Luu Quang asked the MARD to consider opinions raised at the meeting to continue perfecting the draft before submitting to the PM for approval.

He noted the plan must concurrently resolve existing issues and take into account current and future trends such as digital transformation, climate change response, and the “yellow card” warning over illegal, unreported and unregulated (IUU) fishing.

It needs to provide orientations while being flexible enough for localities to carry out and ensuring the fishing port system’s connectivity with other infrastructure systems like land, irrigation, transport, and power.

The plan must also ensure the projects listed are financially feasible, make use of non-State budget capital sources, and develop multifunctional facilities to prevent wastefulness and maximise their effectiveness, the Deputy PM requested.

Canada supports Tra Vinh’s small, medium-sized enterprises

The People’s Committee of the Mekong Delta province of Tra Vinh and the Canadian Embassy in Vietnam on November 23 summarised a Canada-funded project to support local small and medium-sized enterprises (SMEs) and celebrated 22 years of bilateral cooperation.

Chairman of the Tra Vinh provincial People’s Committee Le Van Han thanked the Canadian Government for its programmes and projects to support the province’s development.

In 2014, Global Affairs Canada (GAC) – a department of the Canadian Government that manages Canada’s diplomatic and consular relations, promotes Canadian international trade, and leads Canada’s international development and humanitarian assistance – sponsored the SME Project in the context of that local SMEs were facing difficulties and challenges in accessing markets, land, finance and business development services while local infrastructure did not receive has sufficient investment.

The project has a total investment of 12.1 million CAD (8.83 million USD), including 11 million CAD from the Canadian Government’s grant and the remainder from the province’s counterpart capital.

Han said that over the past nine years, activities under the project have helped local SMEs to develop and enhance their competitiveness, expand trade opportunities, and contribute to the province’s sustainable socio-economic development.

Tra Vinh province now has over 2,840 operating SMEs, doubling the number in 2015. Over 28% of the enterprises are owned by women and 6.8% are owned by Khmer ethnic minority people.

In addition, the project also carried out activities to promote innovation in SMEs, improve small-scale infrastructure works in 18 communes/towns across the province, and contribute to the improvement of the province’s investment environment and provincial green index (PGI).

As of October 2023, nearly 30,000 local people benefited from the project, 33% of whom are women and 20.2% are people from ethnic minority groups. In the 2015 – 2023 period, the private enterprise sector in Tra Vinh province has created jobs for over 112,400 workers, 59% of whom are female, and 31% are Khmer ethnic workers.

Congratulating Tra Vinh for completing its commitments to sponsors, Canadian Ambassador to Vietnam Shawn Steil said that in the last 22 years, Tra Vinh has always been an important partner of Canada, and the relationship between the two sides has consistently maintained and more and more comprehensive.

The SME Project’s results will lay a solid foundation for Canada and Tra Vinh to continue cooperating and opening up new opportunities for trade exchange.

On this occasion, the Tra Vinh provincial People’s Committee and the Canadian Embassy in Vietnam awarded certificates of merit to collectives and individuals for their contributions to the project implementation.

Vietnam’s green hydrogen export potential reaches 23 million tons: Experts
  
Vietnam’s orientation is to focus on offshore wind power in combination with other renewable energy sources to produce new energy for domestic demand and export.

Vietnam’s green hydrogen export potential from solar and wind power can reach 23 million tons per year, experts predicted at a consultation workshop on “PtX global perspectives and Vietnam GH2 insights” under the PtX outreach project funded by the German Federal Ministry of Economics and Technology.

With about 85,000 km2 of land available for renewable energy development, Vietnam can install 3,400 GW of solar power and 840 GW of onshore wind power. The largest global markets for hydrogen imports include South Korea, Japan, Germany, the UK, France and Italy.

Speaking about Vietnam’s National Hydrogen Strategy at the November 22 event in Hanoi, Tran Thanh Tung, Deputy Director General of the Department of Oil, Gas and Coal under the Ministry of Industry and Trade, said that hydrogen is considered a priority energy source to replace fossil fuels and is expected to be a significant part of the country’s energy mix in the future.

Vietnam’s orientation is to focus on offshore wind power in combination with other renewable energy sources (solar power, onshore wind power) to produce new energy (hydrogen, green ammonia) for domestic demand and export, he added.

The workshop also shared findings on the potential for ammonia use in Vietnam’s power sector and the technical requirements for power-to-x (PtX) and green hydrogen development in the country.

The development of PtX and green hydrogen must be based on the industry’s sustainability criteria framework (in four areas of environment, economy, society and governance), while meeting the national sustainable development goals, they stressed.

It’s recommended that for the sustainable development of the national industry, Vietnam needs to establish standards and certifications for the PtX industry and make efforts to pilot and operate a carbon market.

In addition, it is necessary to prepare local professionals, attract talents from abroad, develop infrastructure, learn international technology, and provide financial support for domestic PtX projects.

David Jacob, an international consultant IET/GFA, said that the development orientation of green hydrogen should prioritize low-hanging fruit to minimize risks. He recommended investing in industries with no alternative to green hydrogen or those already using hydrogen, such as fertilizer production or refinery desulphurization.

International experts also provided recommendations on medium and long-term strategies for the oil and gas industry, including detailed LCOX analyses at selected sites; establishment of RE & GH2 development zones, space transportation corridors; establishment of areas focused on renewable energy and green hydrogen development and space transportation corridors; a detailed study on marine bunker fuels; study on PtX competitiveness (for domestic demand and export market); analysis of the PtX value chain; and others.

“To achieve the net zero target by 2050, Vietnam needs, in addition to expanding renewable electricity generation and increasing energy efficiency, special measures in the transport, energy and manufacturing sectors, one of which is the use of green hydrogen produced from renewable energy and its derivatives,” said Markus Bissel, PtX Outreach Project Director.

GIZ, in cooperation with the international PtX Hub in Berlin, is implementing the PtX Outreach project to shape the framework conditions for PtX production, securing financing, building global networks and partnerships, and tapping country and market potential for a sustainable PtX and green hydrogen industry, he added.

HCMC hosts discussion with businesses on tax issues

The HCMC Investment & Trade Promotion Centre (ITPC) and the city’s Tax Department yesterday co-held a formal discussion between the municipal leaders and 570 enterprises on tax policies.

The discussion focused on answering questions of the business community in HCMC regarding corporate income tax exemption and reduction for investment projects to protect the environment; value added tax exemption, reduction, and refund; business licensing fee; the correct procedures to declare and finalize corporate income tax and personal income tax (PIT); preferential policies for corporate income tax; regulations on expenses that are deductible for value added tax.

Many participants raised questions whether financial aid expenses, bonuses for male employees when their wife give birth, vehicle parking allowance, and childcare allowance are subject to PIT.

In response, the tax authority said that a one-time allowance when a laborer gives birth and monthly childcare allowance, which is one of the responsibilities of employers as regulated in the Labor Code, are not subject to PIT.

However, the vehicle parking allowance and the bonuses for male employees when their wife give birth are classified as benefits of employees, and thus being listed by employers as an income from salary or wage subject to PIT in order to declare and deduct for this tax as stipulated by the law.

This is the 239th formal discussion between the business community and the municipal authorities. Since 2022, ITPC and the city’s Tax Department have co-hosted 93 such meetings, both online and offline, attracting the participation of nearly 19,000 companies. More than 5,200 questions have been fully answered.

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