BUSINESS NEWS IN BRIEF 13/12

Industrial equipment displayed at first-ever fairs in HCM City

The Vietnam International Machinery Fair (VIMAF) and the Vietnam Supporting Industry Fair (VSIF) kicked off in Ho Chi Minh City on December 12.

The first-ever events, held at the Saigon Exhibition and Convention Centre, feature around 450 booths of 300 businesses from Vietnam and other countries, including the Republic of Korea, Singapore, Thailand and India.

They showcase a wide range of industrial products such as factory automation, products supporting hi-tech industries, metal working machines and tools, factory equipment, electrical equipment, and industrial spare parts and materials.

Major brands present at the three-day fairs include Doosan Infracore, Century Precision, Dae Jin Hydraulic, Shin Myung Electric MFG, and 3A Engineering.

Nguyen Phuong Dong, Deputy Director of the HCM City Department of Industry and Trade, said the fairs are meant to help local businesses, particularly those in supporting industries, to introduce their products, thereby encouraging them to make innovation to improve their production capacity so that they can gradually take part in global supply chains. 

Meanwhile, Dong-Youn Sohn, Chairman of the Republic of Korea’s Association of Machinery Industry (KOAMI) – a co-organiser, said the VIMAF and the VSIF are those that industrial suppliers and producers should not skip if they want to enter the Vietnamese market.

He added that during the fairs, leading speakers from the Korea Institute of Industrial Technology will also provide special training to help improve participating engineers’ knowledge about and skills in operating integrated smart technologies.

The VIMAF and the VSIF 2018 are organised by the HCM City Department of Industry and Trade, the HCM City Association of Mechanical-Electrical Enterprises, KOAMI, and the RoK-invested Coex Vietnam company. 

Vietnamese firms invited to SelectUSA Investment Summit

US Ambassador to Vietnam Daniel Kritenbrink is recruiting companies to join the Vietnam business delegation for the SelectUSA Investment Summit to be held in Washington DC from June 10-12, 2019.

The Investment Summit promotes the US as the world’s premier investment destination and connects qualified foreign firms with US economic development organisations to facilitate business investment and job creation, according to a press release from the US Consulate.

“Investing in the US is one of the best decisions that Vietnamese firms can make, especially as the country’s economy continues to rapidly expand,” said Kritenbrink.

“As firms benefit from this expansion, they should look to expand into new markets and it is only natural to consider one of Vietnam’s largest export markets, the US,” he added.

The US is home to more foreign direct investment than any other country in the world, with a total stock of 4 trillion USD at the end of 2017.  

The previous five summits alone attracted thousands of international investors and economic development representatives from across the US.

The US Commercial Service Offices in Hanoi and Ho Chi Minh City will again organise this year’s delegation to the summit.  

Early this month, the ambassador and consul general of the US officially launched the 2019 SelectUSA Summit recruitment by hosting luncheons for select local investors.  

“Invest in the USA” seminars will be held by the US Mission to Vietnam in Hanoi and HCM City in advance of the summit.

The seminars will help attendees learn more about the SelectUSA Summit, while hearing from representatives of EDOs in the US on investment opportunities and incentives in their respective location.  

Twelve total investors from a variety of industries across Vietnam attended the 2018 Summit.  

For the second year in a row, Vietnam had the largest delegation from Southeast Asia, with delegates attending seminars covering issues affecting FDI in the US, including infrastructure, tax reform, deregulation, and advanced manufacturing.

Established in 2011, SelectUSA’s mission is to facilitate job-creating business investment into the US and raise awareness of the critical role that foreign direct investment plays in the US economy.

Conference discusses Vietnam real estate market trend

Economic experts and representatives from a range of firms gathered  together at a teleconference on investment trends and opportunities in Vietnam’s real estate market, held in Hanoi on December 11. 

Participants focused on analysing, predicting, and coming up with solutions to help develop the real estate market in a balanced, stable, and sustainable manner; as well as help investors and the public better understand the upcoming market trends of 2019.

Nguyen Manh Ha – Vice Chairman of the Vietnam Real Estate Association (VNREA), the event’s organiser – said that statistics from the association shows that the Vietnamese real estate market continues to be stable with supply on the rise compared to 2017.

Beside Hanoi and Ho Chi Minh City, other localities such as Dong Nai, Binh Duong, Bac Ninh, Bac Giang, and Phu Tho have also recorded positive signals in their property markets. 

Ha said large projects like miniature cities with full services and synchronous infrastructure, such as those invested by Vingroup, are a prominent trend in the market, which is said to contribute to orienting the future of the sector. 

Due to the abundant supply, sudden rises in real estate price are not likely in 2019, Ha stressed, adding that the market will continue to maintain stability throughout the year.

Sharing Ha’s opinion, Dang Hung Vo, former Deputy Minister of Natural Resources and Environment, said that projects invested in by Vingroup are good options in the lower-end housing segment. 

Currently, the price of Vingroup’s housing products is not low, but buyers are offered options to pay over a longer duration, Vo said.

A brighter point in the real estate market is the industrial real estate segment, which is considered a new wave in Vietnam.

There is huge potential to development the segment as Vietnam becomes an attractive destination to foreign investors, especially those operating in industrial production. 

The development of industrial zones must be synchronised to attract foreigners, participants said. 

Regarding capital sources for the real estate market, Can Van Luc from the Bank for Investment and Development of Vietnam (BIDV) said that some companies have taken initiative in issuing bonds so they do not depend on the banking system, adding that this is a positive signal. 

Export of electric wire, cable surges

Export of electric wire and cable earned Vietnam nearly 1.6 billion USD in the January-November period, up 24.7 percent compared to the same period last year, according to statistics of the Ministry of Industry and Trade.

The figure for November alone was 150 million USD.

High growth was seen in the export of the products to China, Japan and the Republic of Korea this year.

China alone spent 530.79 million USD to import electric wire and cable from Vietnam in the first 10 months of the year, an increase of 39.1 percent year on year.

Meanwhile, the value of shipments to the RoK went up by 34.46 percent, and that to Japan, by 21.46 percent.

At present, Vietnam has more than 200 enterprises producing and exporting electric wire and cable.

Hoa Binh inks deals worth billions of USD at investment promotion conference

Leaders of the northern province of Hoa Binh handed approval decisions on nine projects and signed Memorandums of Understanding with 15 investors on 19 projects with total registered capital of 94 trillion VND (approximately US$4 billion), at an investment promotion conference on December 11. 

Addressing the conference, Prime Minister Nguyen Xuan Phuc hailed Hoa Binh for its 8.36 percent growth rate, which is the 19th highest level among provinces and cities in the country. 

He highlighted the province’s convenient location between the northwest and the northern delta, along with beautiful natural landscape, good environment and rich culture of local ethnic groups, and urged Hoa Binh to optimize its potential and advantages to become the driving force for economic growth in the northwest region. 

The Government leader suggested the province focus on four spearhead economic sectors, which are eco-cultural tourism, hi-tech agriculture to supply farm products for the capital region and for export, industrial production in designated areas, and ecological urban areas. 

PM Phuc assigned ministries and agencies to facilitate investment attraction and socio-economic development in Hoa Binh through policies and mechanisms and key infrastructure projects. 

Hoa Binh currently houses 38 foreign invested projects worth a combined 702 million USD and 508 domestic investment projects with total registered capital amounting to over 66.8 trillion VND.

Seminar updates firms on RoK plant quarantine regulations

A seminar was held in Ho Chi Minh City on December 11 to help local businesses gain an insight into the Republic of Korea’s (RoK) regulations on plant protection product residues on farm produce exported to this market.

Kim Ki-joon, President of the Korea Trade-Investment Promotion Agency (KOTRA) for Southeast Asia-Oceania, said after the Vietnam-RoK Free Trade Agreement took effect in December 2015, bilateral trade, including in agricultural products, has enjoyed impressive growth.

However, the RoK also applies high quarantine standards for imported animal, plant, and food products, and many Vietnamese exporters have faced difficulties in meeting its quarantine requirements, he noted.

Nguyen Thanh Huong, an official at the Plant Protection Department (PPD) under the Ministry of Agriculture and Rural Development, said that the plant protection products which pose high risks to human and animal health and the environment include chemicals warned by the Food and Agriculture Organisation (FAO), the World Health Organisation (WHO), the UN Environmental Programme, and Annex III of the Rotterdam Convention; products containing pathogenic microorganisms; and those causing genetic mutation or cancer for humans.

Since 2017, the PPD has reviewed and removed some chemicals likely to affect human and animal health and the environment from the list of permitted ones, including acephate, diazinon, zinc phosphide, malathion, and carbendazim.

Huong said her department and the RoK’s Animal and Plant Quarantine Agency (QIA) are jointly carrying out an examination programme for dragon fruit and mango at Vietnamese factories before they are shipped to the RoK.

The QIA transferred the monitoring work to the PPD in 2015 and has only randomly examined the vapour heat treatment at local factories. Meanwhile, the RoK side has examined Vietnamese mango since 2014, and the PPD has also proposed the QIA handover the pre-export monitoring of this fruit, she added.

To help Vietnamese farm produce meet importers’ requirements, the PPD has been tightening the registration, production, sale, and use of plant protection products, she said, noting that it has also boosted communications to encourage farmers to use and businesses to trade in biological plant protection products.

The RoK is a big agricultural product buyer of Vietnamese goods. Its imports of Vietnamese agricultural, forestry, and fishery products rose from 700 million USD in 2015 to 1.8 billion USD last year, representing 3.4 percent of its purchases of farm produce from overseas, according to the Ministry of Industry and Trade. 

Over 26 million tourists visit Hanoi in 2018

Southern region aims to develop start-up and innovation ecosystem, Organic firms need to do research: experts, Power corporation to record over 12 percent growth in 2018, Vietnamese firms invited to SelectUSA Investment Summit

Foreign tourists gather on a street in Hanoi's Old Quarter

The total number of visitors to Hanoi is estimated to hit 26.04 million this year, up 9.3 percent from 2017, as released at a regular press conference of the municipal Party Committee on December 11.

Among these visitors, there are about 5.74 million foreigners, of whom 60 percent come from Asia and some 24 percent from Europe. Tourism is calculated to earn the capital more than 75.8 trillion VND (3.26 billion USD) throughout the year, an annual increase of 11.7 percent.

Deputy Director of the municipal Department of Tourism Nguyen Anh Dung attributed the outcomes to the city’s expansion of cooperation programmes with other localities nationwide and with organisations it holds membership in, like the Council for Promoting Tourism in Asia (CPTA) and the Tourism Promotion Organisation for Asia-Pacific Cities (TPO).

He said the promotion of Hanoi among the global audience of the US’ Cable News Network (CNN) and the local authorities’ building of a smart tourism system also contributed to the results.

To keep such growth momentum, the department has recently set out a variety of measures. Accordingly, it will intensify communications activities to promote international sports events hosted by the city, like the Formula One (F1) race in 2020 and the 31st Southeast Asian (SEA) Games in 2021. Cooperation with international airlines, travel agencies, and other related organisations are prioritised with a focus on key tourist markets like the US, Europe, Southeast Asia, East Asia, and India. The department will pay attention to promotion work at international exhibitions and continue its collaboration with other localities in Vietnam.

In 2019, Hanoi aims to welcome 28.58 million tourists for a revenue of 84.78 trillion VND (3.64 billion USD), up 9.8 and 11.8 percent from the 2018 estimates, respectively. Of the total visitors, there will be about 6.66 million foreigners. 

Power corporation to record over 12 percent growth in 2018

The Northern Power Corporation (EVNNPC) is projected to enjoy a 12.14 percent production growth in 2018 with 64.3 billion kWh of electricity, according to a report delivered at the firm’s customers’ meeting in Hanoi on December 11.

This year, the EVNNPC is likely to earn 105 trillion VND (4.51 billion USD), up 16.62 percent over 2017, said the report.

So far this year, the firm has provided middle-voltage power to 2,107 customers. All service standards of the firm have been improved, winning more satisfaction from customers.

Addressing the event with the participation of nearly 400 customers, Le Quang Thai, EVNNPC Deputy General Director said that the firm will focus on enhancing its capacity and working attitude as well as streamlining its organisation and management system.

The corporation will continue strengthening the application of technology in production and show stronger performance in serving customers and the society, he said.

Shim Won Hwan, General Director of Samsung Vietnam, lauded the cooperation of EVNNPC, noting that power is significant to the firm’s production and one day of power cut can lead to 200,000 USD in loss.

Vo Quang Lam, Deputy General Director of the Electricity of Vietnam, highlighted contributions of customers in ensuring power supply through the refrain from electricity use in peak hours.

He called for economical and effective use of electricity as 2019 is forecast to be a tough year for the power sector.

According to report by the World Bank, Vietnam posts 87.94 points in Power Access Index in 2018, ranking 27th out of the 190 economies, 37 places higher than the 2017 ranking, and becoming the country with the most impressive step forwards in the index in the region.

Vietnam also surpasses the Philippines to rank fourth among the ASEAN countries in the field. It is in the second position in the region regarding time to provide power services.

Organic firms need to do research: experts

Southern region aims to develop start-up and innovation ecosystem, Organic firms need to do research: experts, Power corporation to record over 12 percent growth in 2018, Vietnamese firms invited to SelectUSA Investment Summit

Companies interested in organic agriculture should engage in market research and brand building, and not just simply chase trends without having first identified buyers, experts have said.

Nguyen Thanh Thuy, Director of Xanh Vietnam Agriculture Co. Ltd., said that farmers in Bac Giang province, for example, refused to buy her company’s organic fertiliser unless the firm could find traders who would buy their fruits.

She said the company could not find traders who were willing to buy at her requested prices.   

Nguyen Tan Phap, whose start-up involves growing organic vegetables in Quang Nam province, noted that the "clean" market has high potential, but the prices are higher than traditionally grown products.

In addition, since many customers do not completely trust organic products, trust building and brands are especially crucial.

Do Ha Nam, former Chairman of the Vietnam Pepper Association, said that developing organic farm products requires careful market research and demands.

Firms should not just encourage farmers to adopt organic production methods without making sure that buyers exist. Otherwise, farmers may lose faith in firms, he said.

Nguyen Van Bo of the Vietnam Academy of Agriculture Science said that organic agricultural goods currently only account for a tiny part of Vietnam’s farm produce.

Many firms and households producing organic goods are small, without proper planning or market research.

Organic agriculture has strict requirements that farmers have to follow, and they need help with better infrastructure and markets, as organic farming is environmentally friendly and produces clean produce, he added.

Nam said that several foreign firms wanted to cooperate with Vietnamese pepper firms, which could help sell Vietnamese organic pepper to global markets.

Although Vietnam’s organic products such as seafood, honey, coconut, pepper and fruit are considered to have good value, organic farming requires understanding of market demands first, Bo said.-VNA

Southern region aims to develop start-up and innovation ecosystem

In HCM City and the south-western region, individuals set up 75 per cent of all start-ups and organisations the rest, according to the Ministry of Science and Technology office in the southern region.

Its chief, Phạm Xuân Đà, told a seminar in HCM City yesterday that "the region has great economic potential".                   

"Many supporting activities to promote a start-up and innovation eco-system are being undertaken in HCM City and Cần Thơ and Trà Vinh and Bến Tre provinces," he said.

They focused on offering legal assistance, helping with business registration, registering intellectual property, and teaching them about finance and corporate governance, helping reduce the risk of failure, he said.

According to Huỳnh Kim Tước, managing director of the Saigon Innovation Hub (SiHub), the city’s start-ups and innovation eco-system are in four key industries: plastic, pharmaceutical chemicals and rubber; food processing; mechanical engineering; and electronics and telecommunication.

This eco-system supports efforts such as the use of technology in education, sectors like hi-tech agriculture, technologies used in food processing and biotechnology, medical technology, clean technology, AI (artificial intelligence), VR (virtual reality), AR (augmented reality), robotics, and smart systems.

Nguyễn Thị Mai Hương, co-founder and managing partner entrepreneur of Empower Hub Việt Nam (E3Hub), said "start-ups and innovation-driven enterprises are a key element in the country’s development strategy".

“They not only create more jobs but also diversify production and modernize the economic structure.”

The countries with the best conditions for dynamic entrepreneurs were the US, the Netherland, Singapore, and Finland, she said.

“An agency is required to directly support Vietnamese start-ups.”

The Government should create favourable conditions for schools, colleges and universities to incubate and invest in start-ups, she said.

It should help start-up businesses develop human resources, build an entrepreneurial spirit and access international markets, she said.

"Improving the business environment, preferential policies and venture capital are required to develop start-ups and innovation eco-systems," she said.

"Easing administrative procedures for venture capital investment and creating smooth mechanisms for divesting capital are also needed."

Work starts on office tower project in SHTP

Asia’s leading business space solutions provider Ascendas-Singbridge Group and its joint venture partner Saigon Bund Capital Partners today, December 6, commenced construction on Office Tower 2 at OneHub Saigon, HCMC’s first fully integrated business park inside Saigon Hi-Tech Park (SHTP).

This demonstrates the partners’ commitment and proactive response to meeting the growing demand for high-quality office spaces with large floor plans, following the successful handover of Office Tower 1 last month.

Office Tower 2 has a gross floor area of some 20,333 square meters, spreading across 10 floors and two basements. The LEED Silver-certified Tower 2 is expected to start operations in the second quarter of 2020.

Leasing for Office Tower 2 is now open. Together with Office Tower 1, Office Tower 2 targets companies from the information technology, business process outsourcing, finance and back office outsourcing sectors.

The building also offers space solutions for companies seeking expansion, relocation or consolidation; companies looking for large floor plans to improve their productivity and working environment; and companies supporting tenants in SHTP.

“We have seen strong demand in the office market and have observed a decentralization trend in areas where infrastructure is well developed. The robust demand is evident from the positive take-up rate of Office Tower 1,” Tan Yew Chin, CEO for Singapore and South East Asia, Ascendas-Singbridge Group, said in a statement.

OneHub Saigon, a joint venture between Ascendas-Singbridge Group and Saigon Bund Capital Partners, aims to provide a seamless and vibrant work-live-play-learn environment for its tenants and the surrounding community. The 12-hectare development will comprise seven office towers, a mixed-use commercial block, work-office home-offices, an education centre and recreational amenities and will be built with sustainable features.

Assessments of import-export firms to be transparent

The General Department of Vietnam Customs is inviting comments on the set of criteria for ensuring the compliance and assessment of legal compliance by businesses involved in import and export activities, before officially issuing them.

In the past, import and export companies would on their own declare goods for the red, green or yellow channels, which have different rates for goods clearance and different levels of strictness for goods control. The classification of goods depends on the department of customs’ assessments of the company’s business profile and import-export history. These assessments are not publicized and can be subjective.

Businesses do not know the specific reasons for being directed to a certain channel, and this method of classification has triggered the payment of bribes to customs officers so that businesses can have their goods cleared quickly through the desired channel.

However, to make the control of import-export activities transparent, the customs body has issued risk management criteria. With this, the customs authority will evaluate businesses to classify them by collecting, analyzing and verifying data on their business activities and legal compliance.

The customs body plans to rate the levels of legal compliance on a four-point scale, with 1 signifying high compliance; 2, medium; 3, low; and 4, no compliance. These levels are associated with specific criteria in terms of legal violations, tax evasion, administrative fines, and so on.

Although the customs body will collect information for verification and supervision purposes, businesses are encouraged to make self-assessment based on the given criteria. Highly rated businesses will get benefits, such as faster goods clearance.

Notably, businesses can find out their evaluated degree of legal compliance and request the customs to clarify its assessments.

Deputy head of the General Department of Vietnam Customs Hoang Viet Cuong told the workshop discussing the set of criteria on December 4 that the tool would help eliminate subjective judgments as everything will be assessed with clear criteria.

GoBear Vietnam hits 10 million visitors on second anniversary

GoBear Vietnam has reached 10 million visitors on its website www.gobear.com/vn after two years of operations in Vietnam from December 7, 2016 to December 7, 2018, up from one million just one year ago.

The financial comparison platform keeps evolving and is ready to launch a smartphone app to improve financial inclusion for Vietnamese users.

As the first and only metasearch engine for insurance and banking products in Asia, GoBear provides users a comparison platform that is free, easy to use, and transparent.

Since it officially went live in Vietnam in early December 2016, with eight products – comparison of credit cards, personal loans, travel insurance, fixed deposits, bank accounts, home loan, home equity loan, and car loan – GoBear Vietnam has reached the 10 million visitor mark on the website www.gobear.com/vn and has become a trusted provider of search and comparison services for financial products in Vietnam.

As the first and only metasearch engine for insurance and banking products in Asia, GoBear provides users a comparison platform that is free, easy to use, and transparent.

To provide more meaningful benefits to Vietnamese users, GoBear Vietnam will launch Easy Apply, a smartphone app powered by CredoLab that enables banks and financial companies to extend credit to a larger pool of customers while keeping risks in check, in early 2019.

The app will be an integrated part of GoBear’s user journey, and will kick-off with the personal loans segment and extend to credit cards, insurance products, and other credit lines in the near future.

On this special occasion, Adrian Chng, CEO of GoBear, said, “Vietnam is one of the fastest growing emerging markets of Southeast Asia today, and I am pleased to see that Vietnamese users are enthusiastic to compare financial products.

“GoBear Vietnam has shown strong growth in the past year, and received significant recognition from users as well as business partners. We are excited to bring more innovations and transparency to the market in the years to come.”

“Improving financial inclusion and serving the unbanked is very important in an emerging market like Vietnam. They have limited access to mainstream financial services, which is a significant problem as it can substantially restrict the flow of capital to would-be entrepreneurs and small businesses. With the Easy Apply app, I believe GoBear can definitely help to improve financial accessibility for our Vietnamese users,” said Bao Nguyen, country director of GoBear Vietnam.

Vietnamese-inspired coffee brand raises $2mn from five funds


Southern region aims to develop start-up and innovation ecosystem, Organic firms need to do research: experts, Power corporation to record over 12 percent growth in 2018, Vietnamese firms invited to SelectUSA Investment Summit

Vietnamese-inspired coffee brand Copper Cow Coffee announced the closing of a $2 million round of funding on December 4.

The round was led by Silverton Partners, which contributed half of the capital, with CRCM Ventures, Montage Ventures, AmplifyHer Ventures, and Social Starts also taking part, according to food-focused industry source NOSH.

Copper Cow previously raised $1 million from friends and family, angel investors, and its participation in the 500 Startups accelerator program. The 18-month-old company has seen rapid growth, reaching 3,000 stores since its inception in 2016.

Founder and CEO Debbie Wei Mullin said that the capital is necessary to scale the brand’s e-commerce and office sales. As a result of this focus, Ms. Mullin said she chose to seek investment from firms with strong backgrounds in e-commerce and technology rather than traditional CPG venture groups.

Copper Cow’s core SKUs - a Vietnamese coffee kit, available with or without condensed milk - both involve a single use, biodegradable pour-over filter that is prefilled with sustainably sourced Vietnamese coffee. The brand also produces a Thai iced tea kit in partnership with Tea Drops.

Ms. Mullin said the brand’s coffee aims to deliver consumers the convenience and portability of instant coffee with a superior taste and on-trend pour-over experience. Additionally, she added, Copper Cow’s light weight gives the brand an advantage in e-commerce over ready-to-drink options, which naturally incur higher shipping costs.

She also plans to explore coffee subscriptions for offices. Two of the brand’s largest clients include tech companies Lyft and Masterclass. For these customers, the company offers a $125 “brew station” containing 50 Vietnamese coffee pour-over filters and 50 sweetened condensed milk packets packaged in a display tray.

“Office coffee is actually half of the US coffee market,” Ms. Mullin said. “I also know that my core buyers - under 35-year-old specialty coffee drinkers - are going to prefer to buy things online. They are also going to want an omnichannel experience, but overall they are going to want to spend more of their dollars online rather than in-store or other channels.”

She expects online and office sales to outpace those in traditional retail channels over the next year.

That’s not to say that retail is not a focus for the brand, as it has added roughly 1,000 stores every six months. Ms. Mullin said that increased consumer interest in Asian-American brands and pour-over coffee has created an environment where Copper Cow’s unique offering is eagerly accepted by buyers.

The brand’s popularity with two core segments of shoppers - specialty coffee drinkers and Asian-American consumers - has provided access to retailers ranging from Williams-Sonoma and Cost Plus World Market to Walmart, with the latter adding Copper Cow to its “Asian” grocery set in over 1,000 stores since September.

“Asian-Americans are one of the fastest-growing income demographics in the US and have the highest growth in terms of consumption power,” Ms. Mullin said. “So, people shopping in the Asian section are either going to be an Asian-American, who for Walmart shoppers are going to have a higher price point that they are willing to spend, as well as what I’ll call ‘Asian enthusiasts’, who tend to be widely traveled and more savvy about the quality of ingredients and are willing to spend more for a better quality product.”

Hanoi aims to become national logistics hub

Hanoi is expected to become one of the country’s three major logistics hubs that meet international standards, said a municipal official. 

Nguyen Thanh Hai, Deputy Director of the municipal Department of Industry and Trade, said Hanoi has launched a project on managing and developing logistics services in the locality by 2025. 

Accordingly, the city will build two logistics centres in its north and south, each spanning from 20 to 50ha and connected with inland container depots (ICD) and seaports like Hai Phong, Hon Gai and Cai Lan, and airports, coach and railway stations, and industrial parks. A specialised logistics centre will also be constructed at Noi Bai International Airport. 

The sector is expected to contribute 9-11 percent of the city’s gross regional domestic product (GRDP) by 2025 when two logistics centres, two ICDs, an international container port and other facilities are put into operation.

Tran Duc Nghia, Director of Delta International Co., Ltd, suggested increasing connectivity in the logistics chain, especially between vehicles, in order to reduce logistics costs and improve the professionalism of the services. Taking the busy Hanoi-Hai Phong route as an example, he said it needs logistics services at both sides. 

Statistics reveal that only 5,445 out of about 25,000 businesses registering logistics services in Hanoi become operational. Up to 80 percent of them are private and the majority have small scale and limited capital, technologies and workforce. 

Therefore, domestic logistics businesses meet only about 25 percent of the market demand while the rest are fulfilled by global groups like Kunhe Nagel, Schenker, Bikar and APL Logistics. 

Economists pointed out limitations in the city’s logistics sector such as unutilized river ports, old railway system and small-scale warehouses, along with high logistics cost. 

Businesses have to burden various logistics fees regarding customs and transportation, which is one of the reasons making Vietnamese products find hard to compete with others from regional countries, they said. 

Covering an area of over 3,300 sq.m and with a population of over 8.2 million people, Hanoi is one of the country’s leading localities in FDI attraction. In the first eight months of 2018, Hanoi lured 5.93 billion USD in FDI.

Along with the synchronous infrastructure system, Hanoi is also the leading locality in promoting regional economic connection, and is home to many domestic and foreign logistics service companies.

With these factors, Hanoi is qualified for developing into a logistics service centre of the country, Nguyen Tuong, a senior advisor of the Vietnam Logistics Business Association, said at a workshop in Hanoi last month.

He suggested the city roll out policies to concretise the Government’s laws and decisions on logistics development in the locality.

UK investor plans offshore wind farm in Binh Thuan

The proposed offshore wind power project in the south central province of Binh Thuan will have a designed capacity of 3,400 MW and require total investments of nearly 12 billion USD, UK developer Enterprize Energy said.

According to Chairman of Enterprize Energy Ian Hatton, Ke Ga offshore wind power project will be developed in 600-megawatt phases. It will use 9.5 megawatt wind turbines initially, and more powerful ones are expected over time.

It will be carried out on an area of nearly 2,000 square kilometres, 20 kilometres offshore Ke Ga cape.

The project is expected by investors to create a new breakthrough for wind power development in Vietnam.

Under an agreement inked with its Vietnamese partners- Petroleum Equipment Assembly & Metal Structure (PVC-MS) and Vietnam-Russia Oil and Gas Joint Venture (Vietsovpetro), the two Vietnamese firms are in charge of the project’s design, construction, installation of offshore power transformation stations, and connection of underground cable and transmission grid.

Meanwhile, Mitsubishi Vestas Offshore Wind, a joint venture of Vetas Wind System A/S and Mitsubishi Heavy Industries Ltd, will supply wind turbines. 

Experts said that greatest challenge of the project must be the selling price of wind power. 

The feed-in tariff (FIT) is 9.8 US cents per kWh for offshore wind power projects which become operational before November 2021 under the Government’s Decision No.39/2018/QD-TTg. However, the first phase of Ke Ga wind power farm will not begin operation until 2022, and the price of wind electricity is still indistinct, Ian Hatton said.

According to Deputy Director of the Electric and Renewable Energy Department under the Ministry of Industry and Trade Nguyen Van Thanh, as the project has not been added to the national power development plan, the selling price of wind power cannot be fixed.

Chairman of the Vietnam Energy Association Tran Viet Ngai said that competent authorities should give timely assistance to the project so that it can complete investment procedures soon, making contributions to increasing capacity of Vietnam’s power sector, especially when wind power is a clean energy which does not cause any harm to the environment.

Vietnamese, Greek enterprises urged to foster trade partnership

Businesses of Vietnam and Greece were encouraged to promote cooperation in the trade of their products of advantage, especially in maritime transport, logistics, shipbuilding, sea port development, tourism and agricultural product processing, at a Vietnam-Greece Business Forum held in Hanoi on December 10. 

Held by the Vietnam Chamber of Commerce and Industry (VCCI) the occasion of the ongoing working visit to Vietnam by Deputy Foreign Minister of Greece Terens Nikolaos Quick, the event attracted the participation of representatives from 16 firms of Greece operating in food industry, olive oil production, textile and garment, real estate, energy, and electricity. 

During the event, the two sides highlighted the fine development of the bilateral cooperation between the two countries in recent years, and the potential for them to expand bonds in the time to come. 

According to Vice Chairman of the VCCI Doan Duy Khuong, Vietnam - Greece trade turnover increased from 196 million USD in 2015 to 335 million USD in 2017. 

He underlined the need to promote economic and trade ties between the two nations, saying that Vietnam is now one of the most attractive consumption markets in the world.

Vietnam is considered a dynamically developing economy in Southeast Asia, becoming an attractive destination for foreign investors, he said, adding that the country has a strong export potential for farm produce, textiles, leather products and footwear.

It has been active and recorded remarkable achievements in reforming the economy, improving the business and investment environment, perfecting the legal and institutional system, and simplifying the administrative procedures, Khuong stressed. 

The country has also cooperated extensively with key partners, ratifying 10 bilateral and multilateral free trade agreements (FTAs) with regional and international partners, he highlighted, adding that about 60 economies have negotiated and are negotiating FTAs with Vietnam, including key trading partners that hold about 90 percent of Vietnam's trade turnover. 

He called for support from governments of both sides and more efforts from their businesses to further boost bilateral trade ties. 

For his part, Terens Nikolaos Quick affirmed that the fine traditional friendship between his country and Vietnam over the last 43 years is a solid foundation for the two sides to strengthen multi-faceted cooperation in the coming time.

Vietnam and Greece have cooperated in the shipping industry and they are currently in the process of negotiating the signing of a cooperation agreement in this field. 

It can be said that this is a most promising cooperation field for the two sides, he said, adding that if implemented, it will become a big impetus to boost economic relations between the two countries.

The ratification of the European Union - Vietnam Free Trade Agreement (EVFTA) in the near future will also contribute to creating a legal corridor and opportunities to promote trade ties between the two countries, he said.

Vietnam a silver lining in Asian economy: Asia Society

Vietnam is a silver lining in the Asian economy in 2019, according to Vice President of the Asia Society Policy Institute (ASPI) Wendy Cutler.

Speaking at a recent workshop on the future of Asia held by the ASPI in New York, the official said Vietnam has emerged as a silver lining in the regional economy with an economic growth of over 6 percent over the past two years.

She also highlighted opportunities the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will bring to the Southeast Asian country, adding that as one of the first six countries to sign the deal, Vietnam could optimise benefits from the CPTPP.

In mid-November, the Conference Board economic consultancy organisation predicted Vietnam will be a bright spot in the global economy and have plenty of room to boost economic growth in 2019.

According to the organisation, the economy is projected to expand by 7 percent in the coming year.


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