The decision also sets out that the country's total offshore wind power capacity will be expected to be 6,000MW by 2030, with onshore wind power at 21,880MW, biomass power at 1,088MW, waste-to-energy power at 1,182MW, additional rooftop solar power at 2,600MW, and battery storage at 300MW.

Vietnam is expected to develop 300MW of flexible power sources, and priority has been given to areas with potential capacity shortages.

Vietnam also plans to import about 5,000MW of electricity from Laos, which could increase to 8,000MW subject to improvements and reasonable electricity prices.

Meanwhile, the central and southern regions hold the potential to export power overseas ranging from 5,000MW to 10,000MW when feasible projects emerge.

Renewable energy will be used to produce new types of energy such as green hydrogen and green ammonia for the domestic market and exports, with a planned capacity of 5,000MW by 2030.

Many rural, mountainous, and island areas of the country remain off-grid, and Decision 262 is part of the government’s plan to extend power supply to these historically under-served regions. The aim is to connect over 910,000 homes in almost 15,000 villages to the national grid or renewable energy projects.

Under the implementation plan, Vietnam will build two interregional industrial and service centres for renewable energy in the northern and central-southern regions. The move aims to develop an industrial ecosystem for renewable energy services.

The country also supplies power to almost 2,500 small- and medium-sized water pumping stations across 13 Mekong Delta cities and provinces.

Component makers seeking clarity on incentives

Parts suppliers are crying out for clarification through an amended decree that could make it easier for them to access business incentives and save both time and money.

Nguyen Minh Ngoc runs a company in an industrial zone of the northern province of Bac Ninh which produces silicon and adhesive film for phone LCD screens. Last month, it was refused confirmation of incentives for projects making supporting industry items on the government’s list of products prioritised for development.

Ngoc understood that his company’s project could enjoy incentives because its products are in the category of electronic components on the government’s list of supporting industry items prioritised for development in Decree No.111/2015/ND-CP.

“We properly followed the procedures to submit documents to request confirmation of incentives for projects making supporting industry items. They were submitted to the local Department of Industry and Trade, but we were rejected due to our products not being completely appropriate to the list in Decree 111.”

“Numerous manufacturers of spare parts and components like us are the primary suppliers of factories that are manufacturing and outsourcing such products prioritised for development as specified in Decree 111. Therefore, the production of these spare parts and components is critical and indispensable to a complete chain of items,” Ngoc said.

Furthermore, many of these spare parts and components play a key role and account for a large proportion of the total value of finished products, Ngoc added. At the same time, certain spare parts and components require technologies that are even more advanced than the primary products.

“This process is very time-consuming, and applicants have to submit additional documents multiple times at the request of the licensing agency. It took several months and a lot of our effort to prepare the dossier and wait for feedback several times, and still we were not approved,” Ngoc said.

Megatech Vietnam Co., Ltd. in Hanoi’s Quang Minh Industrial Zone, which processes plastic trays for holding phone cameras, and manufactures and processes tape and film used in the production of phones and electronic devices, is also facing the same difficulty. Its operations do not entirely match the category of electronic components (plastic, rubber, mechanical, electronic, and glass) in Decree 111’s list, so they cannot enjoy as many incentives as they were expecting.

“Many enterprises making spare parts or components specified in Decree 111 have submitted applications but failed to receive approvals,” said Seck Yee Chung, a representative of the tax and customs working group at the Vietnam Business Forum last month. “These types of enterprises need to be entitled to incentives. The fact that the list of supporting industry products excludes certain groups of projects can lower the effectiveness of the goals of the decree,” Chung said.

Many compliance issues in the past have been addressed by businesses by following applicable procedures, but the licensing agency still rejects their application on the grounds of previous issues, Chung said. “These have led to financial and time burdens on businesses, while lowering the effectiveness of incentive policies and making the business environment in Vietnam less attractive,” he added.

The business community suggested at the forum that the Ministry of Industry and Trade (MoIT) should be tasked to implement confirmation procedures and facilitate appraisal and approval of requests to address specific problems in the implementation of admin procedures, ensuring compliance with prescribed deadlines for the sake of investors.

Decree 111 guides supporting industries, focusing on some business sectors such as textiles and garments, leather, electronics, automobile manufacturing, and more. However, while industries evolve rapidly, and numerous new essential and useful production fields in the chain have emerged, the regulations reveal more inadequacies and limits as they do not cover enough major products with key roles and contributions to industrial development.

To push the industry forward, since last year the MoIT has been building a draft amending Decree 111 to add many new proposed preferential policies, including corporate income tax incentives, supporting human resource training, research and development, trial production, application, transfer and innovation of technology.

In the draft submitted to the government last year, the MoIT proposed that the central budget support interest rate compensation (3 per cent) through the commercial banks with medium and long-term loans in VND to invest in supporting related projects.

The draft also expands the definition of supporting industry and supplements the list of products to cover more stages of production and more items in the chain, specifically adding “processing” and “auxiliary materials” into the definition of supporting industry. It also adds more stages of production for textiles, accessories for the textile, leather, and footwear industries, and components for electronics, vehicle manufacturing, mechanical engineering, and high-tech industries to the list.

Fund required to lower GMT impact

While Vietnam’s draft investment support fund is expected to benefit high-tech enterprises, those same groups have expressed concern over the conditions needed to take advantage.

While the Ministry of Planning and Investment is urgently building the draft decree for establishing new investment support, aiming to issue it in the first half of the year, numerous foreign-invested enterprise (FIEs) associations have been contributing comments on the draft.

Hong Sun, chairman of the Korean Chamber of Commerce in Vietnam, said that criticism was largely based on the ambiguity of the support criteria, making it insufficient to draw in the interest of investors.

“Concerns are rising due to limitations on the eligibility for support, restricting it to investment amounts exceeding $500 million. This restriction may lead to a very limited number of eligible companies, and there is a significant concern that many FIEs may not benefit,” Sun said. “If the investment of these companies is deterred by these measures, it could have a negative impact on the business of all vendor companies that have entered Vietnam.”

Other FIEs also worried that with requirements of very high capital or turnover, only a few enterprises in the high-tech sector will be satisfied.

According to regulations, companies in high-tech parks must meet strict conditions, one of which is that their project’s areas of operation must fit very specific high-tech fields in which investment is encouraged. Anything produced in the parks must be listed as high-tech products, a representative of the Singaporean Chamber of Commerce Vietnam said. “Thus, these businesses should also be targeted for support in the high-tech sector,” he added.

Moreover, regarding scale of investment, the current draft decree looks at the enterprise-level or project-level scale. Research and development outputs are often applied to manufacturing of small but critical spare parts and components in terms of new technology or materials. Due to in-depth applications of each technology, tech companies often carry out investment activities under individual projects or subsidiaries, for each type of product with specific technologies.

“In fact, high-tech companies and projects are often small in scale. If we only look at the scale of each project or subsidiary, which is actually supervised by a larger corporation/investor, we will miss important strategic investors in technology,” said Nakajima Takeo, chief representative of the Japan External Trade Organization in Hanoi.

Currently, there are big names in technology implementing investment activities and long-term commitments in Vietnam, with many subsidiaries and ventures. The scale of investment of an entire corporation might reach over $500 million in total, which would be difficult to realise for a single project. It is suggested that support policies for investors in high technology should target large corporations in terms of their total scale of investment in Vietnam as a single entity.

“For example, if a corporation’s investment capital in Vietnam is from about $1 billion or higher, its high-tech projects will be eligible for investment support policies,” Takeo said. “This is important to draw in large and reputable corporations and encourages corporations to choose Vietnam as a destination of their direct projects in the high-tech sector.”

Gabor Fluit, former chairman of the European Chamber of Commerce in Vietnam, said that if expenditure-based incentives were to be introduced instead of income-based, such as tax holidays, there would be less impact from global minimum tax adoption on foreign investment.

“Examples that could be considered with reference to international practice include accelerated depreciation for machinery and equipment of the projects, and a double tax deduction of labour cost or research and development costs for encouraged ventures,” Fluit said. “Such incentives may increase the likelihood of generating additional investment as they directly target expenses.”

Several countries in the region have already issued and applied some new policies to cope with the global minimum tax and enhance competitiveness in calling foreign investment.

In February, to encourage companies to make sizable investments that bring substantive economic activities to Singapore, the city-state’s finance minister proposed refundable investment credit aimed at providing support to applicable entities, including all businesses with initiatives in key economic sectors and new growth areas.

The US government also recently allocated hundreds of billions of US dollars for sustainability programmes and climate financing, in addition to semiconductor manufacturing, through the enactment of three new laws.

According to the current draft decree on the investment support fund, the scope of target support recipients is narrow, targeting enterprises with investments in high technology whose investment is more than $500 million or whose revenue is over $830 million per year.

FIEs to further explore metal mining

Foreign-invested enterprises expect to engage in mining metals using modern technology, providing the country with the opportunity to develop downstream high-tech manufacturing.

The draft Law on Geology and Minerals, which is set to replace the existing Law on Minerals 2010 (LoM), is scheduled to be submitted to the National Assembly for first comments at its seventh plenary session in May.

Before the amended law is submitted, the Mining Working Group (MWG) of the Vietnam Business Forum is contributing to discussions on reviewing and revising the LoM so that clean and environmentally sustainable mining can be a significant part of Vietnam’s economic growth.

Vietnam is rich in mineral resources, particularly in critical metals such as rare earths, nickel, copper, cobalt, and tungsten. These are all needed by the country’s renewable power and energy industry to help meet Vietnam’s pledges on the reduction of CO2 emissions, and the fast-growing semiconductor chip and digitalisation industries, which Vietnam aspires to be a leader in.

Vietnam’s General Statistics Office reported that in recent years, four Vietnamese-produced commodities that exceeded $10 billion in export value were mainly metallic: mobile phones and spare parts; electronics, computers, and components; machinery, equipment, and spare parts; and vehicles and spare parts.

A MWG report shows that despite such big potential, only a fraction of Vietnam’s valuable metal assets have been discovered to date because of the lack of systematical exploration using modern technologies and methods, such as airborne geophysics and deep penetration technologies to locate more deeply buried deposits.

In addition, illegal mining and local companies using outdated, wasteful, unsafe, and environmentally damaging methods dominate Vietnam’s mining scene.

In view of this, the group said the best way to eliminate environmental damage, apart from enforcing existing regulations, is to encourage foreign-invested enterprises that follow internationally accepted best practices of responsible, sustainable, and efficient mining, environmental protection, and worker safety.

“Currently, working group participants are relatively junior companies but using the world’s best technologies. They are determined to persist and achieve good results in Vietnam as the metals currently being sought or mined by the MWG participants are all essential in the production of electric vehicles and their batteries, wind turbines, solar panels, and digital transformation,” said Bill Howell, chairman of the MWG.

“Having these metals sourced and available in Vietnam, instead of importing them, provides the country with the opportunity to develop downstream high-tech manufacturing industries and establish Vietnam as a dominant regional or even world hub for the manufacture of these products, now highly sought after for a carbon-neutral future,” Howell added. “This is in line with Vietnam’s emphasis on capacity building of manufacturing and supporting industries, and partnership with domestic enterprises where possible.”

MWG members are currently stifled by the apparent lack of coordination and communication among the various Vietnamese ministries and departments involved in exploration and mining, Howell said. It is hoped that bodies like the proposed National Council for Science, Technology, and Innovation and its stated coordination role may help in this regard.

Foreign-invested mining groups have also stated that shortcomings in the LoM itself, as well as excessively high royalties, taxes, and fees compared to other countries, are also significant deterrents to developing an efficient mining industry in Vietnam.

“To draw in quality direct foreign investment in mining, MWG members request the government to benchmark Vietnam’s fiscal regime against peer countries and to provide a fiscal regime competitive with those offered by other jurisdictions. In addition, it is necessary to simplify the current fiscal regime for ease of explanation to investors,” Howell said.

The group hoped that the government and relevant authorities will provide fiscal stability and reduce the frequency of policy changes due to the long lead-time of mining projects, and simultaneously continue improving internal standards and consider recognising and adopting international mineral resource standards, he added.

Vietnam has some 50 kinds of minerals, and 5,000 operating mines. The mining industry makes up of nearly 5 per cent of the country’s GDP, according to statistics published by the Vietnam Minerals Department under the Ministry of Natural Resources and Environment (MoNRE).

The Law on Minerals, promulgated 2010, is considered an important milestone for the state management of minerals. Although the law has contributed to enhancing the effectiveness of the industry, there are still inadequacies.

The MoNRE submitted to the government to amend the law in August 2023. The amended 2010 Law on Minerals will be called the Law on Geology and Minerals.

The draft law will consist of 13 chapters and 132 articles, creating a synchronous and unified legal corridor, ensuring transparency, overcoming inadequacies to uniformly manage the geological and mineral fields, and strictly managing and effectively using minerals.

Highlights of the draft law are the classification of minerals for management, reform of administrative procedures, using the state budget to explore strategic and important minerals, and enhanced management of sand and gravel in riverbeds, lake beds, and sea areas, among others.

The draft law is scheduled to be submitted to the National Assembly for first comments at its seventh plenary session in May this year.

PPP-key to success of one million ha of high-quality rice project

Deputy Minister of Agriculture and Rural Development Tran Thanh Nam emphasized the promotion of investment attraction in the form of public-private partnerships (PPP) for the implementation of one million ha of high quality rice project.

The National Agricultural Extension Center under the Ministry of Agriculture and Rural Development yesterday organized the workshop themed ‘Public-private partnerships in the implementation of the project of 1 million hectares of high-quality and low-emission rice associated with green growth in the Mekong Delta region’.

Speaking at the conference, Deputy Minister of Agriculture and Rural Development Tran Thanh Nam emphasized that to achieve the above goal, Vietnam needs great efforts; not only the Government but also the private sector, businesses, and farmers all together make efforts for the success of the project implementation.

According to Deputy Minister Tran Thanh Nam, one of the key solutions that will be prioritized for the implementation of the project on developing 1 million ha of high-quality, low-emission rice linked with green growth in the Mekong Delta region is to promote investment attraction in the form of public-private partnerships in the coming time.

The Ministry of Agriculture and Rural Development expected businesses and organizations at home and abroad to participate in the special project.

At the workshop, departments under the Ministry of Agriculture and Rural Development, businesses, associations, domestic and international organizations, and leaders of the agriculture sectors in 12 provinces and cities participating in the project evaluated the role of agricultural advisory services, offering solutions to replicate smart rice farming models, and technological solutions to implement the project.

HCM City's innovation startup ecosystem ranks first in Vietnam

According to the Department of Science and Technology of Ho Chi Minh City, the innovation startup ecosystem in HCMC ranked first in the country in 2023.

The Ho Chi Minh City Department of Science and Technology yesterday organized a conference to deploy innovation and start-up activities in 2024. At the conference, the innovation startup ecosystem in the southern metropolis is assessed as the most dynamic one with more than 2,000 startups accounting for about 50 percent. In addition, the city is home to 40 percent of innovation incubators supporting start-ups in the country.

In addition, the innovation ecosystem in the city has attracted 44 percent of investment capital and 60 percent of deals of the country.

At the conference, a representative of the Department of Science and Technology of Ho Chi Minh City talked about comments and orientations of promoting innovation startup capacity through the Ho Chi Minh City Innovation and Startup Award 2024 (I-Star 2024) in 2024.

Vietnam to invest in two industrial service facilities for renewable energy

Vietnam will invest in two industrial service facilities for renewable energy in the North and South regions.

The Ministry of Industry and Trade yesterday held a conference in Hanoi to implement the plan for implementing the National Electricity Development Plan for the period 2021-2030, with a vision to 2050 (referred to as Power Plan VIII). Previously, the Prime Minister approved this plan on April 1.

According to the Implementation Plan of Power Plan VIII, two inter-regional renewable energy industrial service centers including the Center No. 1 in Hai Phong, Quang Ninh, Thai Binh and surrounding areas with a scale of about 2,000MW and the Center No. 2 in Ninh Thuan, Binh Thuan, Ba Ria - Vung Tau, Ho Chi Minh City and surrounding areas will be built.

At the conference, General Director of Vietnam Electricity (EVN) Nguyen Anh Tuan proposed that the Ministry of Industry and Trade promulgate regulations to control the progress of power source and grid projects as well as impose sanctions on the projects whose progress is behind schedule.

At the conference, representatives of some localities also asked the Ministry of Industry and Trade to allow the conversion of coal-fired power projects to LNG-fired power plants or increase renewable energy power sources. Minister of Industry and Trade Nguyen Hong Dien affirmed that the types of power sources and capacities in Power Planning VIII have been evaluated and forecast to meet the country's development requirements, so localities need to comply with the plan.

Regarding the implementation plan of Electricity Planning VIII, at the regular press conference for the first quarter of 2024 recently organized by the Ministry of Industry and Trade in Hanoi, Deputy Minister of Industry and Trade Nguyen Sinh Nhat Tan said that according to the present regulations, after the plan is issued, related agencies and localities necessarily develop an implementation plan.

The highlight of this plan is the issue of energy conversion, said Mr. Nhat Tan. The government encourages the development of clean and green energy sources in addition to mechanisms accompanying with the government’s encouragement to support people during energy conversion. He added that it is important to specify projects to develop a plan.

According to the Power Plan VIII, it is necessary to specify projects in key and priority areas which account for up to 70 percent of capacity. In addition, localities should specify their power projects.

However, local administrations are currently confused about carrying out power projects so the Ministry has reported to the Government and the Standing Government proposing to give more time for localities to review their situation, said Deputy Minister Nguyen Sinh Nhat Tan.

HCM City’s market stabilisation programme wins support of businesses

As many as 69 enterprises in Ho Chi Minh City have engaged in the city’s market stabilisation programme this year, up 10 from the number in 2023.

The municipal People’s Committee has issued a plan on the implementation of the programme that covers food, foodstuff and other necessaries, including those in service of the 2025 Lunar New Year (Tet) Festival.   

The majority of the participating enterprises are reputable brands, commanding a high market share and serving as key nodes in supply chains that span across many cities and provinces nationwide.

Therefore, this year’s programme is expected to help increase output, as well as consumers’ access to goods governed by the price stabilisation policy.

Products under the programme rise by 4-6% year-on-year and make up 21-32% of the market share in ordinary months, and 24-41% in the Lunar New Year period.

The enterprises will receive support in business premises rental prices, transport services and brand building.

The programme, together with many others in support of production and business activities in the country’s southern biggest economic hub, is set to raise production capacity and competitiveness of the participating firms in particular and those in the city in general./.

Vietnamese durian accounts for nearly 32% of China’s imports

Vietnam’s durian exports accounted for 31.8% of China’s total import turnover of this item, according to the Plant Protection Department under the Ministry of Agriculture and Rural Development (MARD).

The signed protocol on phytosanitary requirements for Vietnamese durian exported to China has created an opportunity for Vietnam to develop its durian industry in a modern, quality, safe, and sustainable manner, the agency said.

According to the department, the successful entry of frozen durian products into the Chinese market will create an important step forward for the Vietnamese durian industry. Vietnam's durian industry is likely to surpass Thailand and dominate the Chinese market if Vietnamese growers focus on renovating cultivation techniques and improving the quality of products, it added.

The General Administration of Customs of China (GACC) has so far approved 708 farming area and 168 packaging facility codes for Vietnamese durian products.

The department has requested relevant localities and agencies to intensify inspection and supervision over growing areas and packaging facilities to strictly control the quality of exported agricultural products, and timely detect and promptly handle related violations and fraud.

It also encourages cooperation between farmers and businesses on the principle of equality and win-win cooperation in the development of agricultural value chains with close linkages between production, processing and consumption.

Currently, Vietnam has more than 112,000 ha of durian under cultivation, accounting for 9% of the country's total fruit tree area, with a yearly estimated output of 863,000 tonnes. The main importers of this fruit are China, Thailand, Japan, and the US.

The country’s major durian-growing areas include the Central Highlands with more than 52,000 ha, accounting for about 47% of the total area, the Mekong Delta region with 33,000 ha (about 30%), and the Southeast region with 21,000 ha (about 19%).

Last year, Vietnam exported 595,000 tonnes of durian to China, marking up 98.6% of the total durian export volume. In the first two months of 2024, Vietnam shipped over 41,000 tonnes abroad./.

Dong Nai among Vietnam's top 10 localities in FDI attraction

Foreign direct investment (FDI) attraction remained a bright spot of the southern province of Dong Nai in the first quarter in 2024.

According to the provincial Statistics Office, the province attracted 571 million USD in FDI in Q1, up 13.3% over the same period in 2023. With the sum, Dong Nai ranked in the country's top 10 provinces and centrally-run cities in terms of FDI attraction in the first quarter.

There were 24 newly licenced projects with total registered capital of 291.4 million USD, a 5.5-fold increase over the same period last year. Meanwhile, 24 projects were permitted to add 279.9 million USD to their registered capital, down 37.9% year on year.

The office said the FDI investment capital in the first three months of the year was mainly invested in newly licenced industrial parks.

Dong Nai attracted 1.2 billion USD in 2023, an increase of 11% compared to 2022. Among the projects, there were 81 newly licenced projects with total registered investment of over 467 million USD, and 94 projects permitted to add over 761 million USD to their capital.

The province is now home to nearly 1,600 valid FDI projects, with combined investment capital of over 34 billion USD.

The province’s industrial production index in the first quarter of 2024 rose by 5.1% over the same period last year. The slow increase in industrial production index was attributed to a lack of orders.

In addition, the political situation and inflation in the world have greatly affected production activities of local industrial enterprises, leading to lower production indexes of key industries in the area than the same period last year, especially key manufacturing industries such as textiles and garments, leather shoes, chemicals, electronic products, and computers./.

Housing prices pick up in HCMC, Hanoi – report

Housing prices in HCMC and Hanoi continued to inch up in the fourth quarter of last year, according to the Savills Property Prices Index report released on April 2.

In Hanoi, the housing price index reached 134.9 points, increasing by 30% versus the third quarter of 2019. Contributing factors to this surge included a constrained primary supply, robust market demand, ongoing infrastructure development, and enhancements in quality.

During the fourth quarter of last year, absorption rates surged by 15 percentage points compared to the previous quarter and by 12 percentage points year-on-year. New supply represented 43% of the market share, with a commendable absorption rate of 46%, particularly notable in suburban areas.

The anticipated recovery in housing demand is expected to be bolstered by consumer confidence and recent legislative reforms.

In HCMC, the housing price index increased by two points to 126 points. While secondary property prices stabilized in 12 districts, they saw an uptick in four districts.

Secondary property prices in HCMC reverted to 2020 levels, averaging VND69 million per square meter of net sellable area.

New listings dominated sales during the quarter, comprising 78% of all units sold. These new properties demonstrated a robust absorption rate of 84%. However, existing inventory encountered challenges, with only a modest absorption rate of 14%.

Two-month durian exports reach same level as entirety of 2022

By the end of February, Vietnam had exported more than 41 thousand tonnes of durian, approximately the same amount exported throughout all of 2022.

Vietnamese durian exports accounted for 31.8% of China’s total import turnover of this product, according to the Plant Protection Department under the Ministry of Agriculture and Rural Development (MARD).

The country has currently more than 112,000 ha of durian under cultivation, accounting for 9% of its total fruit tree area, with a yearly estimated output standing at 863,000 tonnes. The main importers of this fruit include China, Thailand, Japan, and the United States.

The signed protocol on phytosanitary requirements for Vietnamese durian exported to the Chinese market has created an opportunity for the nation to develop its durian industry in a modern, quality, safe, and sustainable manner, the agency said.

According to the department, the successful entry of frozen durian products into the Chinese market will serve to create an important step forward for the Vietnamese durian industry. Indeed, the nation’s durian industry is likely to surpass Thailand and dominate the Chinese market if Vietnamese growers focus on renovating cultivation techniques and improving the quality of products, it added.

The General Administration of Customs of China (GACC) has so far approved 708 farming areas and 168 packaging facility codes for Vietnamese durian products.

The department has therefore asked relevant localities and agencies to intensify inspection and supervision over growing areas and packaging facilities in a bid to strictly control the overall quality of exported agricultural products, whilst timely detecting and promptly handling related violations and cases of fraud.

It also incentivizes co-operation between farmers and businesses on the principle of equality and win-win collaboration in the development of agricultural value chains with close linkages between production, processing, and consumption.

The country’s major durian-growing areas include the Central Highlands with more than 52,000 ha, which accounts for about 47% of the total area, the Mekong Delta region with 33,000 ha (about 30%), and the Southeast region with 21,000 ha (about 19%).

Last year witnessed the nation export 595,000 tonnes of durian to China, marking up 98.6% of the total durian export volume. During the two-month period, the country exported more than 41,000 tonnes.

China is widely viewed as the major export market for Vietnamese durian, accounting for more than 90% of the country's total exports. Vietnamese durian is gradually penetrating new markets such as Japan, the Republic of Korea, the US, and the EU.

Vietnamese wood exports surge in Q1

Vietnam’s export of timber and wood products during the first quarter of the year soared by 18.9% to reach US$3.4 billion against the same period last year, according to data given by the General Department of Vietnam Customs.

March alone witnessed wood exports surge by 46.3% to US$1.12 billion compared to February, but down 1.9% compared to March 2023.

With a rise in export orders during the opening months of the year, there is a positive outlook ahead for the wood industry this year.

Especially, the demand for wood products in the United States, China, Canada, the UK, and markets in the EU has rebounded, thereby opening up bright export prospects to these markets moving forward.

With regard to the export market structure, the US represents the largest importer of Vietnamese wood products. During the two-month period, timber exports to the US made up 53.2% of the total export turnover, reaching US$1.2 billion and representing an increase of 51.7% against the same period from last year.

Along with the US market, strong export growth was recorded in a number of other markets, including China with turnover reaching US$306.3 million, up 25.3%; Canada with US$36 million, up 47.4%; the UK with US$32.8 million, up 35.2%; the Netherlands with US$23.2 million, up 46.9%; and France with US$22.1 million, up 26.7%.

Despite optimistic signs, wood export businesses are facing new difficulties due to escalating tensions occurring in the Red Sea coupled with rising freight rates. Moreover, the wood industry also faces fierce competition from other rivals and risks of trade fraud.

Especially, international partners have been increasingly placing higher requirements on wood traceability, sustainable production, and carbon emission reduction.

Experts pointed out that heavy reliance on the US market has increased risks for the wood industry, noting that local firms are advised to diversify export markets in a bid to reduce these risks and enhance the sustainability of the sector, as well as improving product design to attract more international customers.

'Made in Moscow' booth impressive at Vietnam Expo 2024

The Moscow Export Centre on April 3 opened a booth at the Vietnam International Trade Fair (Vietnam Expo 2024), one of the leading international trade exhibitions in Vietnam, which is underway in Hanoi.

The “Made in Moscow” booth displays a range of items from confectionery to electronics, personal protective equipment, medical equipment, and software solutions, among others, by prestigious Russian brands.

In his opening remarks, Chief Representative of the Russian Trade Office in Vietnam Viacheslav Kharinov expressed his hope that the exhibition will open up cooperation opportunities for businesses of the two countries.  

Victoria Gorshkova, representative of the Russian Ministry of Agriculture in Vietnam, affirmed that Russian businesses, especially those in Moscow, have seen the Southeast Asian nation as a promising market, and expressed her hope that Russian firms will find strategic partners at the event.

Vietnam Expo 2024, the 33rd event of this kind, features nearly 600 booths, up 20% year-on-year.

Apart from traditional promotion activities, product showcases, and trade connections, the four-day expo, which kicked off the same day, promotes business-to-business (B2B) matching through an online platform to attract both domestic and international commercial organisations and enterprises.

It is expected to attract 20,000 visitors./.

State budget revenue from exports, imports down 4.2% in Q1

State budget revenue from exports and imports in the first quarter of this year reached VNĐ88.35 trillion (US$3.53 billion), equivalent to 26.3% of the estimate, and down 4.2% year-on-year, the General Department of Vietnam Customs reported on April 3.

Three-month exports fetched $93.06 billion, a rise of 17% compared to the same period last year, and imports, $84.98 billion, up 13.9 %, resulting in a trade surplus of about $8.08 billion.

The agency was assigned by the National Assembly to collect VNĐ375 trillion for the State coffer this year, with VNĐ204 trillion expected to come from exports and imports.

The agency said it will continue with the reform of customs policies and procedures, ensure state management and prevent trade fraud, while creating a full legal foundation for the building and implementation of a digital and smart customs model, thus facilitating trade and contributing to meeting growth targets.

Smuggling, trade fraud, and drug trafficking took place complicatedly in the quarter, it said, noting that customs forces detected and handled 3,483 cases with a total value of about VNĐ5.81 trillion. 

Bright prospects for An Giang mangos to conquer more demanding markets

After nearly 10 years of negotiating, dozens of tonnes of Vietnamese mangos farmed in the Mekong Delta province of An Giang have been exported to Australia, the US and the Republic of Korea, which is a stepping stone for the product to enter more choosy markets.

With 70% of its area being alluvial land, An Giang has favourable conditions to promote agricultural industry, which is a key pillar in the local economic development.

Among major local agricultural products, mango has made great contributions to the growth of the province’s agricultural sector.

Currently, An Giang has 19,700 hectares of fruit farms, with nearly 12,633 hectares of mangos with an output of 225,000 tonnes per year. Major mango farming hubs of An Giang are Cho Moi district, with 6,400 hectares, and An Phu 1,800 hectares.

Nguyen Si Lam, Director of the provincial Department of Agriculture and Rural Development said that the province’s agricultural sector pledges to assist local businesses, organisations and farmers in building a stable material region and developing a sustainable value chain to serve exports.

The province will speed up the granting of codes for mango farming areas to increase export volume, according to Lam.

An Giang will call on businesses to link up together in producing and selling mangos, while encouraging farmers to engage in collective economy, enhancing the efficiency of mango farming cooperatives, especially those meeting GlobalGAP standards and operating effectively, he said.

The official underlined that the province will increase coordination between export processing facilities with cooperatives and cooperative groups to ship more processed products to choosy markets such as the US and Europe.

Meanwhile, Vice Chairman of the provincial People’s Committee Nguyen Thi Minh Thuy said that the province will strengthen the application of science and technology in mango production, while renovating the production process towards safe, VietGAP and GlobalGAP standards, using biological, organic and microbial fertilisers.

Meanwhile, An Giang authorities will increase supervision and inspection to control pesticide residue on mangos, and develop more planting area codes, the official underscored, adding that the efforts aim to ensure quantity, quality, safety and traceability of mango products for export./.

Vietjet to opens direct route between Ho Chi Minh City and Xi'an

After two routes to Shanghai and Chengdu, Vietjet will open a direct route between Ho Chi Minh City and Xi'an (China) from April 29, becoming the airline flying directly from Vietnam to the ancient capital of Xi'an.

With four return flights per week, the new route will help shorten the distance and travel time between the two destinations.

The flights from Ho Chi Minh City to Xi'an will take off on every Monday, Wednesday, Friday, and Sunday at 20:05 (local time), and land in Xi'an Xianyang International Airport at 01:30 the following day (local time). The return flights from Xi'an to Ho Chi Minh City take off on every Monday, Tuesday, Thursday, and Saturday at 02:30 (local time), and land in Ho Chi Minh City at 06:25 (local time).

Vietnam strengthens online trade promotion for farming, OCOP products

The OCOP Market event in a cooperation programme between the Việt Nam Agricultural Trade Promotion Centre and TikTok Vietnam has had a positive effect bringing agricultural and OCOP products to customers on the social network.

More than 800 live stream sessions of the OCOP Market event were held with a total revenue of more than VNĐ100 billion (US$4 million), attracting 1.4 billion viewers. 

This campaign has supported for more than 3,000 products of the One Commune One Product (OCOP) programme nationwide in doing online business activities.

This information was given at a ceremony of summarising cooperation between the Agricultural Trade Promotion Centre, the Ministry of Agriculture and Rural Development and TikTok Vietnam held in Hà Nội on April 3.

According to Nguyễn Minh Tiến, the centre's director, e-commerce is one of the pillars contributing to the growth of the digital economy in Việt Nam.

For the agricultural sector, to realise the goals of the OCOP programme for the 2021-25 period, promotion of branding, propaganda and consumption for OCOP products on digital platforms is also one of the key solutions of the programme.

On February 28, 2023, this centre signed a strategic cooperation agreement with the TikTok Vietnam to promote digital transformation for the national OCOP programme. 

This cooperation has opened up many opportunities for producers and traders of OCOP products to develop consumption channels on e-commerce platforms.

So far, after one year of developing the OCOP Market campaign, it has been deployed in 38 provinces and cities. The OCOP Market campaigns have contributed to development of the local economy and agricultural sector.

Trần Nho Hưởng, deputy head of the Coordination Office of the New Rural Development Programme in Thái Nguyên Province, said the sales of OCOP products have increased many times compared to that before participating in trading on digital platforms.

Thereby, localities and consumers know more about regional agricultural specialties. They have expanded markets, promoted trade in goods and increase added value for agricultural products, especially OCOP products, Hưởng said.

The cooperation helps the agricultural trade promotion agency know how to do trade promotion of OCOP agricultural products on the digital platform, Tiến said.

Also at the ceremony, Nguyễn Lâm Thanh, representative of TikTok Vietnam, said this year, the OCOP Market event continues to be one of TikTok's top priorities. Accordingly, it will continue to accompany and support the localities, businesses and farmers to promote business on digital platforms, contributing to the rural economic development.

Vietnamese and Chinese enterprises invest in over US$800 million automobile factory

Geleximco and Omoda & Jaecoo joint venture will co-operate to build an automobile factory in the northern province of Thai Binh worth more than US$800 million with a capacity of producing 200,000 vehicles per year.

On April 4, Geleximco Group and international trendy new energy vehicle brand Omoda & Jaecoo, a subsidiary of Chinese automaker Chery Automobile, officially signed a joint venture contract in Hanoi amid the presence of Minister of Industry and Trade Nguyen Hong Dien.

This event not only marks an important step forward for Omoda & Jaecoo in Southeast Asia, but is also the first time that China's new energy vehicle maker have entered the Vietnamese market to build such a factory.

The project will consist of three phases, with the first phase set to be completed in the first quarter of 2026.

During the factory construction process, Omoda & Jaecoo will approach the Vietnamese market by importing complete vehicles which are expected to be launched on the market in late 2024. Moving forward, the Omoda E5 SUV smart crossover pure electric vehicle and the Jaecoo 7 PHEV technology cross-country vehicle will be the first products to debut.

Upon addressing the signing ceremony, Minister Nguyen Hong Dien emphasised that manufacturing and assembling cars powered by electric engines, as well as engines using combustion fuels of natural origin, is an inevitable trend of the world, including Vietnam which aims to achieve carbon neutrality by 2050.

Therefore, Geleximco and Omoda & Jaecoo established a joint venture to produce and assemble a line of cars with electric engines and engines making use of combustion fuel of natural origin, which is a both a positive successful trend which is consistent with Vietnam's policy mechanism.

Investing in the nation, the joint venture not only exploits the domestic market of 100 million people, but also has the opportunity to exploit the market of five billion consumers across countries enjoying new generation free trade agreements in which Vietnam is a member, Minister Dien said.

The Minister of Industry and Trade suggested that from the beginning, the joint venture needs to have a clear strategy, plan, and roadmap to exploit, process, and use raw materials on the spot to gradually reduce production costs and increase competitiveness.

It is therefore essential to be transparent about the origin of products to enjoy preferential tax mechanisms and schedules, Minister Dien said, adding that this is also the basis for businesses to deal with future trade remedy lawsuits, the he emphasized.

Also at the signing ceremony, Wu Guoquan, minister counselor of the Chinese Embassy in Vietnam, said that automobile manufacturing is an important pillar industry of the two countries' industries.

Expanding co-operation between the two sides in the automobile industry will certainly add fresh impetus to economic and trade links between the two countries and create new growth in the time ahead.

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