Last update: 08:30 | 10/04/2019
Vietnamese, Dutch firms seek bond in sustainable urban development
Chairman of Hanoi People’s Committee Nguyen Duc Chung (C) speaks at the seminar
A seminar on the sustainable development of cities was held in Hanoi on April 9 between enterprises of the Netherlands and the Vietnamese capital.
The event aims to further tighten the friendship between the Netherlands with Vietnam in general and with Hanoi in particular as part of the ongoing official visit to Vietnam by Dutch Prime Minister Mark Rutte.
Speaking at the seminar, Chairman of the municipal People’s Committee Nguyen Duc Chung briefed participants on Hanoi’s socio-economic development achievements, with high and stable economic growth.
Hanoi is accelerating deeper integration into the global economy, he said, adding that it always pays attention to improving the business and investment environment to attract foreign investment.
He affirmed that the seminar is a good opportunity to promote win-win cooperation between the two sides, expressing his belief that cooperation between Vietnam, Hanoi and the Netherlands will be made even stronger with prominent achievements in the time ahead.
According to Chung, the Netherlands is among Hanoi’s potential investors, with total investment reaching over 606 million USD.
Dutch culture is also not unfamiliar to the people of Vietnam and Hanoi. The Hanoi-Amsterdam High School for gifted students is one of the symbols of friendship between the two capital cities.
Hanoi wants to learn from experience of the Netherlands and hopes to expand cooperation with the European country in wastewater treatment, Chung said.
President of the Confederation of Netherlands Industry and Employers Hans de Boer said the visit of Dutch Prime Minister Mark Rutte to Vietnam shows that the Dutch government appreciates the friendly cooperative relationship with Vietnam, as well as admires the achievements made by Hanoi and Vietnam in recent years.
He said that the seminar offers an opportunity for businesses of the two sides to share experience, thus opening cooperation opportunities and strengthening bond between the Netherlands and Hanoi.
During the seminar, representatives from the two sides’ enterprises offered and discussed solutions, expressing their willingness to establish cooperation.
Officially establishing diplomatic relations on April 9, 1973, Vietnam and the Netherlands have since built good friendship and cooperation.
Notably, Hanoi continues to receive attention from the Dutch government and businesses. Meanwhile, the Netherlands is one of Hanoi’s important partners for learning and coordination in many areas, such as environment, urban planning, urban infrastructure and production of construction materials from construction waste, education and training, investment, trade, and tourism.
Tay Ninh licenses additional three foreign investment projects
The People's Committee of Tay Ninh province yesterday licensed three foreign investment projects with total capital of US$ 325 million.
According to a report of the People’s Committee of Tay Ninh province at an overview conference of foreign direct investment (FDI) attraction during past 25 year, the Southwestern province received around 291 projects from 25 worldwide countries and territories with their registered capital of US$ 5.78 billion in December, 2018.
At this time, the accumulated capital investing in the province has reached
around US$ 3.14 billion, occupied about 54.5 percent of the total registered capital.
The FDI enterprises have attracted 113,298 labors, including 110,864 Vietnamese workers working in these enterprises.
HCMC asks for resolution over inconsistence on loans for HCMC
The People’s Committee of Ho Chi Minh City yesterday suggested the National Assembly Committee for Budget and Finance to hold a discussion about the city’s public debt and borrowing funds in 2019, pursuant to regulations of the Resolution No. 54/2017/QH14 of the National Assembly.
According to the Ho Chi Minh City People’s Committee, the Resolution No. 54/2017/QH14 of the National Assembly about piloting special mechanism and policy for Ho Chi Minh City development rules that the city can raise funds from issuing municipal bonds, from domestic and foreign financial organizations with total loan balance if the loan is not more than 90 percent of the decentralized revenue collection from the city budget.
However, the Decision No. 2231/ QD-BTC of the Ministry of Finance about allocation of the State budget revenue and expenditure estimates in 2019 regulates that the highest assigned loan for Ho Chi Minh City reaches only VND 5,493 billion (nearly US$ 237 million) from foreign capitals of the Government, excluding internal funds .
Meanwhile, demand of re-borrowing the Government's foreign loans for the city’s projects is estimated over VND 13,000 billion (US$ 560 million). Because the loan stipulation does not exceed the assigned budget estimate, the city may face difficulties in allocating loan limits for every specific project.
In case of the actual disbursement process of projects is higher than the assigned figure, the city will not have a limit to disburse the loans, affecting to the implementation progress of the projects.
Keppel Land to build luxury hotel in downtown HCMC
Nguyen Thanh Phong (R), HCMC chairman, gives a book about the city to Loh Chin Hua, Keppel Land chairman, after a meeting on April 5. Keppel Land plans to develop a luxury hotel in downtown HCMC
Keppel Land, a Singaporean property developer, will develop a luxury hotel within a property complex project, Saigon Centre, in downtown HCMC, said Loh Chin Hua, CEO of Keppel Corporation and chairman of Keppel Land, during a meeting with HCMC People's Committee Chairman Nguyen Thanh Phong on April 5.
The Keppel Land leader said the firm had completed investing in the first phase of the project, including a shopping mall, an office building for lease, which has attracted many multiple-national corporations, and well-operated serviced apartments. Up to 30,000 people visit these locations every day.
Meanwhile, construction of the luxury hotel, as well as a large-scale convention center, will be developed in the next phases of the project. Keppel Land is quickly putting subprojects into service and creating more added values for the entire project, and city center.
Alongside Saigon Centre, Keppel Land is simultaneously boosting investments in another project in the city’s District 2, named Saigon Sport City. This is the key project of both Keppel Land and Keppel Corporation, since it is a big-ticket project and requires strong cooperation among many divisions of the corporation, including the urban solution unit.
The Singaporean property firm plans to team up with the world’s leading technology firms, such as Microsoft, to develop Saigon Sport City into a symbolic smart urban area in the city. It will deploy technology solutions in security, trade, energy, and sustainable environment, according to the Keppel Land chairman.
Addressing the meeting, the municipal chairman hailed the investing activities of Singaporean investors in the city, including Keppel Land, and stressed that the city will work to improve the business environment to better support local and foreign investors.
Regarding the projects of Saigon Centre 3 and Saigon Sport City, Phong said he expected Keppel Land to quickly finish essential procedures for carrying out the project.
Hua expressed his thanks to the municipal government for creating favorable conditions for the firm to make investment in the city for nearly 30 years. Also, he expected Keppel Corporation to become a long-term partner to invest in the urbanization progress of HCMC and to make contributions to the city’s development.
Keppel Corporation works in the fields of marine, oil, and information infrastructure, while providing sustainable solutions for living environments and smart urban projects, apart from the real estate sector. It has worked in 30 countries throughout the world, including the U.S., the U.K., India, and Japan.
To date, Keppel Land has been approved to carry out 20 projects, building over 22,000 houses in Vietnam.
PM urges completion of Trung Luong-My Thuan expressway by 2020
Prime Minister Nguyen Xuan Phuc Phuc has called upon the Ministry of Transport to complete construction of the Trung Luong-My Thuan-Can Tho expressway by 2020, during a meeting on regional development between some ministers and the Mekong Delta localities’ leaders on Friday in Can Tho City.
The maritime industry is one of the driving forces behind the economic development of the Mekong Delta. Minister of Transport Nguyen Van The said, at the meeting, that there is no better place than Soc Trang Province for maritime development.
Soc Trang is some 60 kilometers from Can Tho, and has three main inter-regional routes – National Road 1, Nam Song Hau National Road and the Quan Lo-Phung Hiep Road – alongside a number of national roads, said Minister The.
He added that Vietnam’s major real estate developer, Sun Group, plans to invest in the Tran De Seaport Project. “They want to set up a major port which can accommodate vessels weighing from 100,000 to 120,000 tons,” he said, adding that the developer intends to inject some VND40 trillion (US$1.7 billion) in the first phase of the project.
He noted that if everything goes as planned, import-export products to and from the delta will no longer have to transit in HCMC. Instead, such goods will be imported and exported directly at the port.
Also, if a planned expressway connecting Soc Trang, Can Tho and An Giang with Cambodia is in place, more industrial zones will be built in the region, thereby helping boost manufacturing operations there.
“If this is the case, the Mekong Delta can be on a par with the region of Dong Nai, Binh Duong and Binh Phuoc provinces,” he said, adding that this region flourishes thanks to its seaport system and neighboring Tan Son Nhat International Airport in HCMC.
He added that the Mekong Delta is already home to Can Tho International Airport. If the Tran De Seaport comes into existence, the entire region will see significant manufacturing improvements to boost its exports and overall economic development.
Aside from the maritime industry, it is also necessary to increase investments in transport infrastructure, especially in the road transport sector.
Minister The said that the Transport Ministry and the People’s Committee of Tien Giang Province are working together to adjust the Trung Luong-My Thuan Expressway project, in line with the prime minister’s instructions.
The Government has decided to offer financial support worth VND2.186 trillion (US$94.2 million) for the project, of which VND500 billion is sourced from the mid-term capital fund. The expressway will be opened to traffic by late 2020.
Regarding the My Thuan 2 Bridge linking Tien Giang and Vinh Long provinces, the National Assembly has chosen to allocate VND5.1 trillion. “The ministry has already approved this project. Work on the project is expected to start in December 2019 and finish in 2023,” he said.
Regarding an expressway section from My Thuan to Can Tho, he said the Government has asked the Ministry of Finance to consider using excess revenue from 2018 to allocate VND932 billion (around US$40 million) for the Ministry of Transport to develop the project whose bidding process is likely to take place later this year.
Minister of Planning and Investment Nguyen Chi Dung echoed the same view, saying that priority should be given to capital allocations for roads, as specified in regional and inter-regional plans, along with waterways.
Meanwhile, Prime Minister Phuc said that without proper transport infrastructure, it is impossible for the Mekong Delta to flourish.
“Among solutions, a breakthrough in infrastructure is the most important. The infrastructure here not only names bridges, roads, and airports, but also includes social infrastructure, schools, healthcare (facilities) and cultural institutions. (It can be) integrated into smart infrastructures, while digital connectivity is adopted more widely,” he said.
He added that there will be a conference on connectivity between the Mekong Delta, the southeastern region and HCMC in the near future.
In the short run, the Trung Luong-My Thuan-Can Tho Expressway needs to be opened to traffic in 2020, while the entire route needs to be available in 2021.
“This is a promise of the Minister of Transport, and of the Government. The Government will fully address the issues about policy mechanisms and funding,” he said.
Regarding other tasks in the time ahead, the Government leader underlined those related to climate change and sustainable development.
It is important to combine economic development and adaptation to climate change, he said, citing the successful examples of Israel and the Netherlands. He also called for research into climate change adaptation solutions for the region.
The Government is also planning a conference to review the execution of its resolution on sustainable and climate-resilient development of the Mekong Delta. One of the issues to be discussed at the event will be the allocation of resources for the region’s development.
Fuel price stabilization fund should be disbanded: Deputy Minister
A woman has her motorbike refilled at a gas station in HCMC’s District 3. The fuel price stabilization fund has to be kept active for the time being, since fuel price governance is still in need of State intervention
The fuel price stabilization fund should be disbanded due to multiple inadequacies related to the use of the fund over time, though Vietnam needs to keep the fund active for the time being, since fuel price governance is still in need of State intervention, Deputy Minister of Industry and Trade Do Thang Hai told a press briefing on April 5.
Vietnam has yet to fully switch to a market economy, thus State agencies have to remain involved in fuel price governance for price stabilization, Hai said, citing a conclusion of the Government.
With more than ten years of regulating local fuel prices, the trade ministry noted that using the fund has always been an effective economic tool, but not as an administrative intervention of the State.
The fund helps compensate for the gap between base prices and retail prices, particularly in certain sensitive periods, and allows the country to not tap the State budget to stabilize fuel prices.
If the fund had not been tapped when electricity prices rose sharply last month, local fuel prices would have surged, he said.
Fuel products are among a few essential items whose prices are gradually adjusted, in accordance with the market price.
Besides this, Decree No.83 regulated a fixed formula to work out fuel prices, with taxes and other fees taken into account. Additionally, fuel prices will be revised every 15 days, based upon the prices traded in Singapore, the main fuel seller for Vietnam.
Along with the active 28 fuel wholesalers in the country, the trade ministry is currently considering granting licenses to more fuel traders for operations in the coming time, as long as they meet requirements stipulated in the decree.
As for the inter-ministries of Industry-Trade and Finance that regulate local fuel prices, they can only make price adjustments based upon the fund. With each liter of imported gasoline, local fuel wholesalers have to extract VND300 to add to the fund. When the fund is excessively used, it will face a deficit.
In response to a source claiming that all local fuel traders faced a funding deficit following the recent price adjustment, Deputy Minister Hai cited the latest statistics at a meeting of the price regulation board on April 2 as saying that only nine out of the 28 wholesalers encountered a funding deficit.
Three-month well-controlled CPI heralds positive inflation trend for 2019
With the consumer price index well controlled in the first three months of the year, high-profile international organisations believe that the country will successfully rein in inflation this year.
A few days ago, Eric Sidgwick, Asian Development Bank (ADB) country director for Vietnam, announced that inflation in the country “will continue to average 3.5% this year, before edging up to 3.8% in 2020, as domestic demand is sustained and as a result of anticipated increases in some administrative prices and minimum wages.”
According to an ADB report on Vietnam’s economic prospects this year, the announcement that the US Federal Reserve will no longer raise its policy rate in 2019 is likely to relieve pressure on the Vietnam dong and inflation, and lower international oil prices.
Besides, upward adjustments to administered fees for public education, healthcare, and electricity may add to inflationary pressures, as may a higher minimum wage.
Spain-based FocusEconomics, which provides in-depth economic analysis globally, also reported that, in Vietnam, mounting domestic inﬂationary pressures, administered price hikes on utilities and the new petroleum tax will likely lift inﬂation moving forward.
“Our panelists project that inﬂation will average 3.4% in 2019, which is down 0.1 percentage points from last month’s forecast, and 3.9% in 2020,” said the firm’s fresh report on Vietnam’s economic outlook.
It is clear that both ADB and FocusEconomics remain upbeat about Vietnam’s inflation this year. The National Assembly has set an inflation rate of below 4% for this year.
In the first three months of 2019, increases in the prices of foodstuffs, educational services, and some other goods and services have served as the key drivers of the consumer price index (CPI) ascension.
The General Statistics Office (GSO) last week reported that Vietnam’s average CPI for the first three months increased 2.63% on-year, a bit lower than the 2.82% rise in the same period last year.
The biggest drivers of the CPI ascension are the strong on-year hike in the prices of foodstuffs (5.18%) and educational services (6.29%), followed by housing and construction material services (1.82%).
Tran My Lan, country director Belgium’s largest exporter of high-quality potato products, told Nhan Dan Online that it is understandable that the price of foodstuffs, one of the 11 groups of goods and services used by Vietnam to measure the CPI, has increased since early this year.
The group’s total revenue in the Vietnamese market in the first three months of this year rose by about 20-30% on-year.
“It is because the local demand is growing, especially during the traditional Tet festival in February. It is expected that our revenue will be higher in the year’s second quarter,” Lan said. “Demand for foreign potatoes in Vietnam is increasing strongly, in particular from enterprises, restaurants, and supermarkets. Our products are now sold by big supermarkets in Vietnam, such as Vinmart, Aeon, Mega Market, Big C, Co.opmart, and Fivimart.”
However, Lan noted that the price of potatoes has skyrocketed by 20-30% since last October because of supply shortages caused by crop losses in some European nations.
According to the GSO, since last September when Vietnamese pupils began their new school year, educational service prices have been on the rise due to the government’s Decree No.86/2015/ND-CP on collecting and managing school fees from 2015-2021, the price of educational services will increase 10% in 2019, generating a 0.5% rise in inflation this year.
Meanwhile, since early this year, the price of housing and construction material services have also increased, due to growing demand among the public, who repaired and built their houses and works, the GSO said.
Furthermore, the price of healthcare services has also climbed in the first quarter of 2019, at 1.11% on-year.
Under the Ministry of Health’s Circular No.39/2018/TT-BYT taking effect on January 15, 2018, the price of healthcare services in all hospitals will ascend in 2019. It is estimated that the price of the healthcare service group will grow 15%, creating a 0.6% rise in 2019’s inflation.
Tran My Lan expected that the prices in the local market may continue increasing.
“For example, our costs for transport and production have increased due to a rise in the market prices,” she said. “Moreover, so as to control inflation, the government delayed the application of a new plan on inflicting environmental taxes on petrol, and postponed the hike in power prices. However in 2019, when an increase in the prices of these items will not be able to be delayed any longer, there may be risks for a climb in inflation.”
Vietnam’s hospitality industry will continue to contribute greatly to the country’s rapid economic growth and create more jobs, Mr. Mauro Gasparotti, Director of Savills Hotels APAC, told the “Meet the Experts” seminar held by Savills Vietnam in Ho Chi Minh City.
The market has witnessed an increase in hotel and resort rates throughout the country in 2018, with the performance of hotels in major cities being particularly strong.
“We are also finally seeing developers beginning to propose international mid-scale and focused service hotels as well as giving more importance to design and guest experience,” he said. “There are market threats coming our way, however, relating to the strong pipeline of new supply in coastal areas, the fast growth of alternative accommodation via Airbnb, as well as the overall expected slowdown in global travelers this year.”
This year’s seminar focused on the impact of technology on hospitality developments and saw the attendance of over 150 local developers and senior industry representatives.
Ms. Uyen Nguyen, Senior Manager at Savills Hotels, said resort destinations have seen slightly lower average occupancy due to new properties entering the market. A total of 75 new hotels and resorts in the four and five-star categories opened in six main coastal destinations, providing 15,900 rooms, or 24 per cent of existing supply. Another 45,600 rooms are expected to come online during 2019-2022, which will certainly pose a threat to large standardized resorts, she said.
“Well-positioned hotels or resorts with an ‘instagrammable’ design, quality F&B, and unique facilities and services are currently performing better, with higher rates and occupancies than the more standard products,” Mr. Gasparotti said. “These products are defined as experience hotels or resorts and will be less affected by the overall pipeline of new openings. We would love to see more of them as they usually, along with the guest experience, also increase the quality of the destination.”
Ms. Uyen added that strong competition may occur between large properties who target groups or budget travelers. Market occupancy for the next couple of years is expected to be affected by new supply in Da Nang, Cam Ranh, and Phu Quoc, in both the condotel and resort segments, and this may result in a slowdown in performance, with rates having to adapt to the new level of competition. That said, it is clear that in Hanoi and Ho Chi Minh City, where new supply will be relatively limited and performance is expected to hold well, that there are numerous opportunities for new developments across all segments.
Mr. Bryan Chan, Director of Development, SE Asia & Korea, at the InterContinental Hotels Group explained how technology is applied to hotel developments both in the construction and operational stages. Guests can now use technology to facilitate their journey before, during and after staying at the hotel. Energy and waste reduction technologies such as the Building Management System (BMS) are expected to save costs by monitoring the ongoing performance of equipment in the building. Modular construction was also discussed during the event, as an innovative method for fast and efficient construction with consistent quality.
Robot butlers, mobile keys, mobile check-in / check-out and smart guestrooms are being applied more often in hotels to reduce operating costs and staff numbers. However, a “human touch” will remain a critical part of the guest experience.
Temasek boosts holding in VNG JSC
The VNG JSC has announced the completion of the sale of 355,820 shares with an average selling price of VND1.8 million ($77.4), higher than the VND800,000 ($34.4) minimum offering price, which its General Meeting of Shareholders has passed.
The buyer is Seletar Investments, a subsidiary of the Temasek Investment Group, owned by the Singaporean Government. Seletar now owns 1.74 million shares, equivalent to 5.04 per cent of capital and 6.35 per cent of shares.
Another investment unit related to Temasek, Gamvest Pte. Ltd., also holds a 10.25 per cent stake in VNG.
The result of this offer, reaching VND662 million ($28.5 million), will be used to expand VNG’s presence in domestic and foreign markets as well as serve some future investments.
VNG still holds more than 7.1 million of the total of 34.54 million shares issued.
If calculated by the average selling price after this last sale of treasury stocks, VNG is valued at about VND64.4 billion ($2.77 billion).
In March 2017, VNG signed a memorandum of understanding (MoU) to list shares on the US stock Exchange, but an announcement is still to come.
VNG specializes in the publication of online games and this remains its main source of revenue. In recent years it has invested in many new companies, such as the Zalo app, payments, e-commerce, and advertising.
In 2018, VNG recorded revenue of VND4.3 trillion ($185.2 million), roughly the same as in 2017. Pre-tax profit, however, fell sharply, from VND938 billion ($40.4 million) to VND347 billion ($14.9 million), primarily because the company spent a lot of money on sales activities.
It lost VND44 billion ($1.9 million) in the fourth quarter of 2018 after a long period of continuous profit in the several hundred millions of dollars each quarter.
Mastercard appoints new Country Manager for Vietnam
Global payment and technology firm Mastercard announced on April 3 the appointment of Ms. Winnie Wong as Country Manager for Vietnam.
Ms. Wong will support Mastercard’s expansion into digital payments options in Vietnam and will play a key role in engaging with regulators and stakeholders to support the Vietnamese Government’s plan to reduce cash payments to less than 10 per cent by 2020.
Based in Ho Chi Minh City, Ms. Wong brings more than 15 years of experience in commercial payments solutions. Since joining Mastercard in Singapore in 2013, she worked with governments and corporations to spearhead the adoption of B2B platforms to help improve the efficiency and transparency of cross-border trade in Asia-Pacific.
Ms. Wong’s appointment demonstrates Mastercard’s commitment to developing Vietnam’s contactless market. With her extensive experience in payment solutions, she will offer deep insights into industry best practices that will help the government achieve its cashless agenda and showcase Mastercard’s best-in-class products and services.
“It’s an exciting time for Mastercard in Vietnam,” said Mr. Ari Sarker, Co-President, Mastercard Asia Pacific. “There is tremendous interest and support from both public and private stakeholders to drive the country’s transformation into a digital economy. Vietnam’s strong fintech culture also creates great opportunities for innovation and the accelerated scaling of new technologies. Mastercard is encouraged by the push across the region to develop a more connected and inclusive cashless society.”
“I am thrilled to manage Mastercard’s expansion in one of Southeast Asia’s most dynamic and fastest growing markets,” Ms. Wong said. “Cashless payments on smartphones are growing at an incredible rate, and this is rapidly changing the way consumers make transactions. By providing an ecosystem for safe and secure payments, Mastercard will enable Vietnam’s businesses and consumers to seize the benefits and convenience of going cashless.”
Ms. Wong brings more than two decades of experience across Asia-Pacific in the banking and consumer goods sectors and holds a Bachelor of Business Administration (Honors) from Universiti Putra Malaysia.
Uniqlo filling two positions for HCMC store opening
The Fast Retailing Co. Ltd., the owner of the Uniqlo brand, is recruiting for two positions through Pasona Tech Vietnam, a recruitment company for Japanese enterprises in Vietnam, as it plans to open its first store in Ho Chi Minh City this year.
The recruitment company has just updated information on Uniqlo’s recruitment in Vietnam, of which there are two positions in marketing and procurement and store staff. Candidates for management positions must be university graduates, possess advanced English skills (TOIEC >750 or IELTS >6.0) and will work in Ho Chi Minh City. There will be more detailed information available at the company’s introduction seminar on April 20 in Ho Chi Minh City and on April 21 in Hanoi. The deadline for applications is April 25. For the store staff position, a seminar will be held on June 8 in Ho Chi Minh City. Candidates will be subject to three interviews before being employed.
Earlier, a representative from the Japanese-based company told VET that the brand will launch the Uniqlo Manager Candidate (UMC) program, which aims to cultivate future business leaders for Uniqlo and help candidates achieve professional growth through a specially-designed training program.
“This is the first time that we will conduct the UMC program in Vietnam,” the representative said. “The final number of candidates has not yet been decided, but we are excited at the opportunity to meet as many talented young Vietnamese people as possible.”
The store will be operated through a joint venture between Fast Retailing and the Mitsubishi Corporation, which will own 75 per cent and 25 per cent of the company. “Vietnam will be the fourth country in which Fast Retailing and Mitsubishi have established a joint venture company, following Thailand in 2011, Indonesia in 2013, and Russia in 2017,” he said. “The partnership has been successful.”
As with all Uniqlo stores around the world, the main objective will be to open outlets that provide the very best Uniqlo experience for its customers. This means choosing convenient locations while also securing a store layout that enables customers to browse and shop for its LifeWear collections in comfort.
According to the company’s annual report, in 2018 its consolidated revenue and profit were 2.13 trillion yen ($19.1 billion) and 154.8 billion yen ($1.4 billion), up 14.4 per cent and 29.8 per cent year-on-year. Total stores around the world reached 3,455 as at 2018. 2018 was the first year in which its revenue in international markets was higher than in its Japanese markets. The brand plans to open 100 new stores in China and 50 in Southeast Asia and Oceania each year.
It predicts consolidated revenue will expand to 2.3 trillion yen ($20.6 billion) (up 8.0 per cent year-on-year), consolidated operating profit will reach 270 billion yen ($2.4 billion) (up 14.3 per cent), and profit attributable to owners of the parent will increase to 165 billion yen ($1.48 billion) (up 6.6 per cent). This would result in earnings per share of 1,617 yen ($14.5).
Uniqlo International is predicted to generate further strong revenue and profit gains in 2019. While it expects operations that were most affected by the warm winter, such as Greater China and South Korea, will increase discounting in the second quarter to promote the sale of winter ranges, it predicted Uniqlo International’s first-half revenue and profit would surpass its initial estimates.
Decision issued to improve Logistics Performance Index ranking
The Minister of Industry and Trade has recently approved Decision No. 708/QD-BCT on a plan to improve Vietnam’s Logistics Performance Index (LPI), tallied by the World Bank.
The plan targets increasing the country’s ranking in the LPI by five to ten levels by 2025, contributing to improving the business environment, cutting costs, and boosting competitive capacity in the logistics service supply and innovation capacity.
The plan includes 49 special tasks attached to the roles of ministries, sectors, and localities, and are divided into index-based groups including infrastructure upgrading, delivery capacity improvements, capacity and the quality of logistics service supply, technology application and traceability capacity, timing and cost savings, customs clearance efficiency improvements, and a supplement group.
The Ministry of Finance is assigned to implement the plan, with the following tasks: boosting the implementation of the National One-Door Mechanism and ASEAN One-Door Mechanism and connecting with trading partners outside ASEAN, increasing the number of Level-4 electronic public services, stepping up the reform of the inspection of specialized import and export goods towards abolishing or simplifying unnecessary procedures, conducting risk assessments, changing from pre-check to post-check, and adopting mechanisms to coordinate and recognize quality and specialized inspection certificates for goods shipped between countries with trade agreements with Vietnam.
The Import and Export Department under the Ministry of Industry and Trade is the focal point, assuming responsibility and coordinating with ministries, branches and localities in deploying, inspecting, and supervising the implementation of the plan.
Vietnam jumped 25 spots in LPI 2018, ranking 39th among 160 countries and territories. The World Bank study found that among lower-middle income countries, large economies such as India and Indonesia as well as emerging economies such as Vietnam and Côte d’Ivoire stand out as top performers after seeing a significant jump in rankings.
The top five logistics performers in 2018 were Germany, Sweden, Belgium, Austria, and Japan. Thailand is still ahead among Vietnam’s neighbors, ranking 32nd. The LPI is released by the World Bank every two years and is a unique benchmarking tool, providing the same measure for more than 160 countries and territories.
Q1 rice export volumes and value down
The Ministry of Agriculture and Rural Development (MARD) has released a report on rice exports in the first quarter of 2019, with volumes estimated at 1.43 million tons worth $593 million, down 3.5 per cent in volume and 20.2 per cent in value year-on-year.
The Philippines was the leading importer of Vietnamese rice in the period, with 40.2 per cent of the total. Other markets exhibiting strong increases in the import of Vietnamese rice were Angola (up over 9.5-fold year-on-year), Côte d’Ivoire (up 6.1-fold), and Hong Kong, South Africa and Australia, whose imports doubled.
MARD said the rice price was at $404 per ton in the first two months of 2019, down 17.8 per cent year-on-year.
The export value of white rice accounted for 60 per cent of total turnover in the first two months of the year, Jasmine rice and fragrant rice 29 per cent, sticky rice 8 per cent, and Japonica rice and Japanese rice 3 per cent.
The largest export markets for Vietnam’s white rice were the Philippines (61 per cent) and Cuba (20 per cent). For Jasmine and fragrant rice, the largest export markets were Côte d’Ivoire (33 per cent), Ghana (14 per cent), and the Philippines (8 per cent).
Hong Kong was Vietnam’s largest sticky rice export market, accounting for 42 per cent of the total, followed by the Philippines (19 per cent) and China (18 per cent). In Japonica rice and Japanese rice, the largest export markets were Papua New Guinea (14 per cent) and the Solomon Islands (13 per cent).
Although the export price in general declined, the price of rice in the Mekong Delta region increased slightly thanks to the temporary storage purchasing policies of rice export enterprises. In March 2019, rice prices in An Giang, Vinh Long, Kien Giang, and Bac Lieu provinces increased after the government bought 200,000 tons of rice and 80,000 tons of winter-spring paddy crop for storage purposes.
According to MARD, although Vietnam’s rice exports faced difficulties in the first quarter of 2019, it’s expected that there will be a variety of new contracts signed in the second quarter due to Vietnamese rice being at competitive prices compared to other exporting countries. Some businesses have reported that they have already accessed some markets and implemented new rice export contracts.
Good news for local rice exporters is that Egypt opened a bid for medium and short-grain white rice to all interested domestic and foreign contractors, with a deadline for submissions of April 30.
SMEs need to learn from stories of success
Vietnam needs a strategy to quickly seize opportunities from successful trends and the lessons of other countries to support small and medium-sized enterprises (SMEs), a leader from the Ministry of Planning and Investment (MPI) told a workshop on “Small and Medium-Sized Start-up Businesses: Catching the Opportunities for Development” held in Hanoi on April 5.
There are many successful lessons from around the world about building innovation centers to support startups and SMEs to expand and apply innovative solutions and science and technology.
In Vietnam, the government has determined that the country needs specific strategies and actions to quickly seize opportunities from Industry 4.0 and learn lessons of success from countries around the world. This is considered key to promoting economic development based on science and technology and innovation.
The National Innovation Center (NIC) will be a center for the research and application of innovative technology in Vietnam, thoroughly applying international experience, private mobilization, or foreign experts, to operate and compete with other countries in the world.
The construction and operation of NICs will be a long and difficult process, requiring effective pilot programs and coordination as well as the support of ministries, branches and associations, investors, banks, companies, and educational organizations.
Mr. Sharath Martin, Policy Advisor ASEAN Region, Australia and New Zealand, at the Association of Chartered Certified Accountants (ACCA), said that in order to scale up effectively, SMEs need to develop goals, visions, and growth strategies. “Their growth strategy will be built on three main fields - forecasting prospects, organizational structure, and behavior,” he said.
ACCA also introduced a set of tools that SMEs can use to maximize the opportunities to expand their business and successfully call for capital, such as a detailed proposal of their immediate needs.
Mr. Tang Ngoc Truong An, General Director of Ibosses Vietnam, said that SMEs and startups have great opportunities, as they are accompanied by the government and receive interest from investors and financial institutions while support from the entrepreneurial ecosystem is growing. “However, success only comes to enterprises that are well-managed under international standards and have financial transparency,” he added.
At the workshop, representatives of MPI, ACCA and Ibosses Vietnam jointly signed and announced a pilot project for developing an entrepreneurial ecosystem for SMEs.