A bank teller counts money at a transaction office in Hà Nội. The average deposit interest rates have increased to 6.9-7.4 per cent per year for terms more than 24 months. Photo cafef.vn

Interest rates for Vietnamese đồng-denominated for long term deposits at commercial banks have reached 7.4 per cent per year, according to the State Bank of Vietnam (SBV).

Under a recent report on deposit and lending interest rates of commercial banks, the SBV said the average deposit interest rates have increased to 6.9-7.4 per cent a year for terms more than 24 months.

Meanwhile, the rates for terms from 12 months to 24 months and from 6 months to 12 months are 5.5-6.2 per cent and 4.4-4.8 per cent per year, respectively.

For short-term deposits, the rate is 2.4-3.4 per cent per year for terms from one month to less than six months and 0.2 per cent for less than one month.

As for lending interest rates, the average lending interest rate of domestic commercial banks for both new and existing loans is in the range of 6.9-9.3 per cent per year, of which the rate for short-term loans is 4.1-5.0 per cent per year and 6.3-7.4 per cent per year for medium and long term.

The average short-term lending interest rate for priority sectors is about 3.6 per cent per year, lower than the 4 per cent short-term lending interest rate cap prescribed by the SBV.

In the interbank market, the overnight interest rate is at 4.5 per cent per year, while the rates for terms of one-week, two-week, and one-month are 4.57, 4.52 and 4.79 per cent per year, respectively.

Since the beginning of the second half of this year, many banks have increased deposit interest rates significantly.

Experts forecast deposit interest rates will increase further in the context of increasing inflationary pressure from the third quarter of this year.

The expected recovery in credit demand thanks to positive prospects for the manufacturing industry and export activities will also lead to banks' need to raise capital, which will cause deposit interest rates to continually increase at the end of the year.

Vietcombank Securities Company (VCBS) forecasts that deposit interest rates in the third quarter of 2024 will continue to increase by about 0.3-0.5 percentage points. The rising pressure may continue in the fourth quarter, pushing the rate up by 0.5-1 percentage point for the whole year.

Banking expert Nguyễn Trí Hiếu said economic growth is stronger and individuals and enterprises are borrowing more from banks. This will push up the credit demand so banks are tending to increase interest rates to attract deposits to meet customers' capital needs. 

Opportunity for Việt Nam as Indonesia increases rice tender volumes

Indonesia has increased its rice import demand by 30,000 tonnes in August compared to the previous month, bringing the total to 350,000 tonnes, according to the latest tender announcement from the Indonesian National Logistics Agency (Perusahaan Umum BULOG).

The tender invitation specifies that Indonesia is inviting bids for 350,000 tonnes of 5 per cent of broken white rice and will favour suppliers to Việt Nam, Thailand, Cambodia, Myanmar and Pakistan.

In the first half of 2024, Indonesia averaged tenders for about 300,000 tonnes of rice each month. Since July, Bulog increased the tender quantity by 20,000, bringing the total to 320,000 tonnes.

However, the tender results fell short of expectations, with the country purchasing only 200,000 tonnes. To meet its demand, Bulog has set an unprecedentedly high target of 350,000 tonnes for the August tender.

Indonesia's call for larger rice tenders is a major opportunity for rice exporters, particularly those from Việt Nam, given the current uncertainties in the global rice market

"Indonesia's increased invitation to bid for rice is a positive signal for Việt Nam's rice export industry. In the bidding round last July, Vietnamese enterprises won the most bids with seven out of 12 lots, accounting for 185,000 tonnes of rice,” the General Director of Cần Thơ Rice Export Joint Stock Company Nguyễn Văn Nhật said.

This shows that Vietnamese rice still maintains a strong competitiveness compared to other sources.

“Although Việt Nam's rice export price is currently the highest in the world, reaching US$578 per tonne, we believe that the increase in demand from Indonesia will create opportunities for us to continue exploiting this market," he said.

He added that the current supply of Vietnamese rice is constrained due to the nearing end of the summer-autumn crop and the autumn-winter crop not yielding a large quantity.

As a result, rice prices will remain high, which could affect price competitiveness. However, the large demand from countries like the Philippines could alleviate some of the price pressure.

Given the current market conditions, Vietnamese rice exporters are approaching tenders with caution to avoid "selling more and losing more" he said.

"We are carefully weighing the pros and cons before bidding, especially considering the premium prices of our rice in the global market."

In the first seven months of 2024, Việt Nam exported nearly 5.3 million tonnes of rice, earning $3.34 billion. The figures set new records for Việt Nam's rice industry compared to the same period in previous years, including 2023.

According to forecasts from the Ministry of Agriculture and Rural Development, Việt Nam is expected to have another successful year of rice exports, with a target of exporting 7.5-8 million tonnes of rice and exceeding five billion US dollars in export revenue. 

Abundant offers at the national promotion programme

A new trade promotion project, across the whole country, will run for nearly the whole of the month of December and the offers will be substantial.

The Ministry of Industry and Trade (MoIT) gave details of the organisation of the 'Việt Nam Grand Sale 2024 - National Concentrated Promotion Programme'.

Scheduled to run from December 2 to 31, the promotion will allow businesses to offer discounts of up to 100 per cent, presenting consumers with numerous enticing shopping options.

The Concentrated Promotion Programme is led by the Department of Trade Promotion under the MoIT, in collaboration with relevant units and trade associations.

Enterprises and affiliated organisations will be responsible for launching and supporting combined traditional and e-commerce promotion initiatives to drive widespread participation from businesses across various sectors.

They are also required to conduct promotional activities that are lawful, transparent, and honest, ensuring the legitimate rights and interests of consumers. Companies must uphold product and service quality standards as well as adhere to current administrative procedures and regulations.

Abundant offers at the national promotion programme

A new trade promotion project, across the whole country, will run for nearly the whole of the month of December and the offers will be substantial.

The Ministry of Industry and Trade (MoIT) gave details of the organisation of the 'Việt Nam Grand Sale 2024 - National Concentrated Promotion Programme'.

Scheduled to run from December 2 to 31, the promotion will allow businesses to offer discounts of up to 100 per cent, presenting consumers with numerous enticing shopping options.

The Concentrated Promotion Programme is led by the Department of Trade Promotion under the MoIT, in collaboration with relevant units and trade associations.

Enterprises and affiliated organisations will be responsible for launching and supporting combined traditional and e-commerce promotion initiatives to drive widespread participation from businesses across various sectors.

They are also required to conduct promotional activities that are lawful, transparent, and honest, ensuring the legitimate rights and interests of consumers. Companies must uphold product and service quality standards as well as adhere to current administrative procedures and regulations. 

RoK boosts agri-equipment exports to Việt Nam

The Republic of Korea (RoK)’s Ministry of Agriculture, Food and Rural Affairs (MAFRA) announced on Monday that it will send a delegation of 15 Korean companies, specialising in exporting agricultural equipment, to Việt Nam from August 26-31 to promote their products.

According to a MAFRA’s report, Việt Nam is gradually emerging as an important market for Korean agricultural equipment and materials export, importing US$1.02 billion worth of those products from the RoK by the end of 2023.

Despite experiencing difficulties due to the global economic downturn, fertiliser and pesticide exports showed an upward trend, with export turnover increasing by more than 33 per cent compared to the previous year.

The Korean delegation is scheduled to engage in an export consultation conference with 30 Vietnamese import companies on August 27.

They will also visit the Ministry of Agriculture and Rural Development of Việt Nam to learn about the current situation of the country's agriculture and related policies, regulations and details related to agricultural equipment certification, including import customs procedures for each item.

The delegation is expected to propose cooperation so that procedures such as registration and licensing for products exported to Việt Nam can be carried out quickly.

Director-General Lee Sang-man of the MAFRA's Agri-Food Innovation Policy Bureau said that by sending the market development team to create sales channels such as overseas fairs, buyer connections and export consultation meetings, the RoK hopes that its agricultural equipment companies will be able to strengthen the foundation for penetrating the Vietnamese market and expanding exports.

Since 2018, the MAFRA has sent a market development team to countries every year to explore opportunities for Korean agricultural equipment exporters to develop overseas markets and expand exports, study the needs of local localities through consultation with local authorities, while providing export consultation and market research support, he added. 

Limited resources and a lack of incentives hindering eco-innovation

Limited resources and a lack of support policies have hindered businesses’ eco-innovation, the development of products and processes that contribute to sustainable development, according to economists and policymakers.

Nguyễn Thị Luyến, head of the economic institution research department at the Central Institute for Economic Management (CIEM), said eco-innovation and more efficient utilisation of resources in production have gained traction in recent years with many localities launching programmes and initiatives for green development models.

At the same time, the participation of numerous organisations, scientists and experts has been crucial in training and encouraging businesses to engage in eco-innovation practices.

CIEM, however, said such policies were still lacking as a consistent, synchronised and coordinated effort.

For instance, it’s unclear what criteria businesses must fulfil to qualify as eco-innovation businesses and what regulations they must follow. Training has mostly covered the theoretical part but is severely inadequate in providing businesses with technical know-how, financial support and supply-chain connections.

"The primary source of financing for innovation is mainly from the businesses' pocket, followed by loans. The number of businesses with access to the State’s financial support remained small,” she said.

Luyến added more policies were needed to involve the private sector, in particular commercial banks and investment funds. She said support must be given in consideration of business sizes and characteristics to encourage innovation and participation.

Mette Ekeroth, a representative of the Danish Embassy in Việt Nam, said Vietnamese SMEs often respond and adapt quickly to new challenges and requirements, not shying away from experiencing new business ideas and models.

She said eco-innovation has proven to be a challenge. However, it can also be an opportunity for pioneering businesses to enhance their competitive advantage, maximise resource-use effectiveness and reduce carbon emissions.

CIEM Deputy Director Nguyễn Hoa Cương said the State has steadily given more support to businesses, especially small and medium-sized enterprises (SMEs) in promoting and implementing eco-innovation, including both financial and non-financial incentives.

For example, there are incentives for eco-innovation for businesses under the Investment Law 2020, the Science and Technology Law 2013, and the Law on Efficient Use of Energy, including preferential regimes for corporate income tax, value-added tax, import-export taxes and land and water lease rates.

He said it’s time the Government implement dedicated support policies and set the criteria requirements as the foundation for the development of business eco-innovation. Meanwhile, the country should focus on completing the legal framework and support policy system for green innovation, including standards, technical regulations, tax policies, financial investment, market policies, consumption policies and policies on education, training, research and development. 

Thailand expected to record growth in Vietnamese fruit and vegetable imports

In the first eight months of the year, fruit and vegetable exports from Việt Nam reached nearly US$4.6 billion, a 29 per cent increase year-on-year, with Thailand expected to continue recording the impressive growth of imports.

Thailand experienced the highest growth in imports of Vietnamese agricultural products during the first seven months of the year, according to figures released by the Việt Nam Fruit and Vegetable Association based on customs data.

The country, which previously ranked sixth after Japan and Taiwan (China), has climbed to fourth place with a seven-month export value of $123 million, a 70 per cent increase compared to the same period last year.

Ngô Tường Vy, CEO of Chánh Thu Company, said that in the first half of this year, Thailand ramped up its purchases of Vietnamese longans, lychees and durians. In particular, Thailand has increased its orders for frozen durians, leading to a significant rise in export volumes.

Secretary General of the Việt Nam Fruit and Vegetable Association Đặng Phúc Nguyên added that Vietnamese durians are available year-round, while Thailand only has seasonal durians.

The El Nino-induced drought has severely impacted Thailand this year, resulting in a decline in durian yields and the fruit's size does not meet standards.

As a result, Thailand has increased its imports of durians from its neighbour, with some shipments being re-exported to China.

Large Thai retail corporations are also importing dragon fruit, longans and lychees from Việt Nam to sell in their supermarket chains.

The import volume from Việt Nam by these companies has doubled compared to the same period last year, contributing to the significant growth in fruit and vegetable export turnover to Thailand.

China remains the largest market importing nearly $2.5 billion worth of fruits and vegetables from Việt Nam in the first seven months, up 25 per cent year-on-year.

Following China are the US and South Korea, with export values of $189 million and $188 million, respectively, representing increases of 31 per cent and 51 per cent.

According to Nguyên from the Việt Nam Fruit and Vegetable Association, when there is a free trade agreement, countries will impose technical barriers. This requires Vietnamese producers and exporters to continuously update their knowledge of import regulations in various markets to comply promptly.

Boost investor risk tolerance in corporate bonds: experts

Bond default risks are inevitable across markets and investors must exercise responsibility and thorough understanding before embarking on investment decisions, said experts. 

Recently, numerous issuing organisations, notably those in the real estate sector, have sought debt restructuring for both principal and bond interest payments, according to the Hà Nội Stock Exchange (HNX).

For example, on August 13, Fuji Nutri Food JSC announced a delay in settling the VNĐ998 billion (US$40 million) principal for bond code FNFCH2223001 (due for payment on August 21), citing challenges in organising funds for payment.

Last September, the company also reported a postponement in paying the VNĐ20.87 billion interest on bond FNFCH2124001, which was due to a similar reason.

Another entity, Big Gain Investment Limited Company, faced payment delays for bonds BGICH2124001 (VNĐ8.9 billion interest and VNĐ78.4 billion principal) and BGICH2124002 (VNĐ49.7 billion interest and over VNĐ438 billion principal).

Big Gain is currently engaged in negotiations with investors regarding the repayment schedule for both principal and interest.

Other cases of delayed bond repayments have been reported, involving companies like Novaland and Gia Đức Real Estate Company. 

Experts forecast that this would be a trend. 

VIS Ratings estimated that around 27 per cent of maturing bonds are at risk of late repayment, including 65 per cent with previous delays. The pressure on corporate bond maturity remains high for 2024 - 2025. 

Decree 08/2023/NĐ-CP on private placement of corporate bonds has expired, but two key amendments persist, allowing companies to extend bond terms by up to two years and repay in assets other than Vietnamese currency with bondholder approval.

Despite extending bond terms by two years, concerns persist over corporate bond issuers meeting repayment obligations. 

Experts worry about market impacts due to potential defaults, with bankruptcy seen as a fundamental remedy. 

Dr Lê Xuân Nghĩa, an economist, advocated for bankruptcy in cases of non-payment, urging investors to accept risks. 

Similarly, Đỗ Ngoạc Quỳnh, General Secretary of Việt Nam Bond Market Association (VBMA), stressed enhancing the Bankruptcy Law for market stability, highlighting the need for effective debt resolution to prevent systemic issues.

Quỳnh refers to cases globally where insolvent companies must publicly disclose their status, convene creditor meetings or hire independent assessors to determine whether to seek bankruptcy protection or file for bankruptcy.

Although negotiation mechanisms exist, few retail investors can effectively assess bonds. Consequently, they may panic as bond maturity approaches when bond issuers struggle with repayments, leading to negotiations for extensions.

Meanwhile, Cấn Văn Lực, chief economist at BIDV and Director of BIDV Training and Research Institute, said that while bankruptcy is already challenging for Vietnamese companies, it becomes even more complex for those with bond debts. 

The unresolved issue is how to address these outstanding bond debts.

On the other hand, investors are also increasingly stressing the need for negotiation. The move is due to the prolonged court process for recovering bonds from insolvent firms, which is significantly longer than out-of-court negotiations in most markets. 

Additionally, instituting bankruptcy procedures for debt recovery may only result in creditors receiving up to 40 per cent of the principal debt, as per VIS Rating data. 

Besides enhancing bankruptcy legislation, experts said that it is important for investors to be aware of their investment duties, comprehending the risks involved in their investment choices and being ready for potential financial losses.

The Lehman Brothers bankruptcy crisis (2008 - 2011) stands as a prime example. 

During this period, numerous investors in Hong Kong (China) holding 'mini bonds' staged protests, attributing blame to the government for its perceived lack of accountability. 

The crux of the matter lay in the government's authorisation of financial product sales with risks that were not fully understood even by the authorities.

Subsequently, state regulatory bodies (including those in Hong Kong) issued liability waivers during sales campaigns, outlining the financial product risks. Distributors were mandated to collaborate with investors and secure signed liability waivers.

This underscores that every financial product carries some level of risk, prompting investors to define their risk tolerance. 

Quỳnh said that in practice, policies should align with each stage of development. Regulatory bodies must accurately assess development stages to establish suitable policies that reasonably safeguard retail investors' interests, rather than providing absolute protection.

In essence, bond defaults, specifically corporate bond defaults, are potential in all markets, necessitating investors to be prepared for such scenarios when selecting this investment channel. 

Some banks are already compelled to create provisions due to problematic bond debts.

Therefore, enhancing investor knowledge is crucial to cultivating a sustainable corporate bond market. 

Vietnam-Singapore renewable energy project reaches new milestone

The Petrovietnam Technical Services Corporation (PTSC) and its Singaporean partner Sembcorp Utilities Pte Ltd held in Singapore on August 28 a ceremony of the hand-over of contract packages on wind and hydrological measurements and geological surveys under the project on exporting offshore renewable energy from Vietnam to Singapore.

The packages aim to provide accurate data on the natural and technical conditions at the project site. The work includes collecting wind data, measuring hydrological parameters, conducting geological surveys of the seabed, assessing the potential for wind power exploitation and identifying advanced technologies for developing the offshore wind power system.

The project, one of the strategic cooperation between the two countries in the field of clean energy, was launched early last year through the signing of a Joint Development Agreement (JDA) on investment cooperation and export of clean energy from Vietnam to Singapore within the framework of Prime Minister Pham Minh Chinh's official visit to Singapore.

Speaking at the event, Chairman of the Board of Directors of the Vietnam Oil and Gas Group (PVN) Le Manh Hung emphasised the event's importance, considering it a milestone in the field of offshore renewable energy of both countries.

He expressed his belief that the PTSC-Sembcorp alliance will overcome difficulties to carry out the project, becoming a symbol of energy cooperation between the two countries.

Hung also believed that the project contributes to realising Vietnam's goal of achieving net zero emissions by 2050, and clearly shows the determination of the Vietnamese Government in implementing its 8th power plan.

Wong Kim Yin, CEO of Sembcorp Industries, affirmed this is an important mark in cooperation between agencies on energy management in general and the project in particular, while highlighting Sembcorp's contribution to Vietnam's energy sector as well as cooperation with the Vietnam Oil and Gas Corporation (PVN) and PTSC.

Given the constraints on renewable energy sources, the Energy Market Authority of Singapore (EMA) has approved importing 4GW of clean electricity by 2025 from neighbouring countries, including 1.2GW from Vietnam.

Sembcorp will import this clean electricity from Vietnam to Singapore, generated from offshore wind farms in collaboration with PTSC and transmitted through new underwater cables spanning about 1,000km.

Following full approval from the Ministry of Natural Resources and Environment of Vietnam for marine resource surveys and assessments in August last year, PTSC is set to conduct offshore surveys in 2024 for its project aimed at exporting clean electricity to Singapore./.

Quang Trach – Pho Noi 500kV circuit-3 power transmission line operational

The 500kV circuit-3 power transmission line linking Quang Trach in the central province of Quang Binh and Pho Noi in the northern province of Hung Yen was officially put into operation on August 29.

Attending the inauguration ceremony saw the presence of Prime Minister Pham Minh Chinh at the main venue in Hung Yen, Deputy Prime Minister Tran Hong Ha at the venue in Thai Binh province, Deputy Prime Minister Le Thanh Long at the venue in Thanh Hoa province, and Deputy Prime Minister Ho Duc Phoc from Ha Tinh province.

The 519km-long line has an investment capital of over 22.3 trillion VND (896.8 million USD), comprising four sections, including Quang Trach - Quynh Luu, Quynh Luu - Thanh Hoa, Thanh Hoa - Nam Dinh 1 thermal power plant, and Nam Dinh 1 thermal power plant - Pho Noi.

The 500 kV transmission line project from Nam Dinh 1 Thermal Power Plant to Thanh Hoa was operational on June 30; the Nam Dinh 1 Thermal Power Plant - Pho Noi and Quynh Luu – Thanh Hoa sections completed on August 18; and the Quang Trach - Quynh Luu section on August 27.

These are critical and urgent power transmission projects with a crucial role in increasing the transmission capacity through the 500 kV system from Central to Northern Vietnam from the current 2,500 MW to 5,000 MW. They will help improve the stability of the power system, boost electricity supply for the north in 2025 and the following years, and reduce the risk of overload and congestion in existing 500 kV lines and stations, thus contributing to ensuring national energy security./.

Vietnam bolsters business cooperation with North African countries

The Vietnamese Trade Office in Algeria and Tunisia chaired a conference to connect Vietnamese businesses and their peers in Algeria, Tunisia, and Lybia.

The event drew 40 businesses, associations, and chambers of commerce of the three North African countries and 40 Vietnamese firms in the fields of production, import and export of agricultural and food products, seafood, industrial products, and logistics.

Addressing the event, Trade Counsellor Hoang Duc Nhuan said that Vietnam is a large market with nearly 100 million consumers and is extensively open to the world. In 2023, Vietnam's economy recorded a growth rate of 5.1%, which is expected to reach more than 6.5% this year.

The country's per capita income has reached 4,280 USD. Last year, exports hit 356 billion USD and imports were 328 billion USD, resulting in a trade surplus of 28 billion USD. Foreign trade value accounted for nearly 200% of the country's GDP, the official noted.

He said that in 2023, Vietnam attracted 36.6 billion USD in foreign direct investment (FDI), with 23.2 billion USD disbursed. Meanwhile, Vietnam invested 420 million USD abroad.

Vietnam joined the World Trade Organisation (WTO) in 2007, and have signed 17 multilateral and bilateral free trade agreements, 17 of them effective.

Vietnam is also an attractive tourist destination in Asia. The Vietnamese tourism industry expects 18 million foreign visitors in 2024. Remittances from the overseas Vietnamese community hit about 16 billion USD in 2023.

Nhuan said that since Vietnam and Algeria set up their diplomatic relations in 1962, their relationship has been developing strongly, with two-way trade reaching 250 million USD in 2023, up 60% over 2022.

The joint venture between Petrovietnam Exploration Production Corporation (PVEP), Thailand’s PTT Exploration and Production Public Company Limited (PTTEP) and Sonatrach Group is a symbol of successful cooperation between Vietnam and Algeria. Launched in 2003, the Bir Seba exploitation project produced the first barrels of oil in August 2015 with a current capacity of 18,000 barrels per day.

Meanwhile, Vietnam and Tunisia established their diplomatic relations in 1979. Data from Tunisia’s customs showed that in 2023, two-way trade rose 51% year on year to about 100 million USD, said Nhuan.

Businesses from the three African countries showed their interest in seeking Vietnamese partners in agriculture, garment and textile, footwear, agricultural machineries, electric vehicles, plastic materials, cosmetics, and chemicals.

Algerian firms were keen on exploring the procedures for establishing a business in Vietnam in the field of import and export of agricultural products and footwear, as well as import-export tax system between the two countries.

Representatives from Tunisia businesses were interest in cooperating with Vietnam in the field of footwear production as well as equipment for producing this product.

Meanwhile, Libyan enterprises said they have demand to seek Vietnamese investors in manufacturing sectors to contribute to the country's reconstruction.

Nhuan said that in order to promote economic and trade cooperation between Vietnam and these countries, the sides need to increase the exchange of business delegations and encourage businesses to participate in international fairs and exhibitions held in each country, while enhancing the exchange of market information and business and investment opportunities, and coordinating in verifying information of business partners and support the resolution of disputes that may arise among companies of the sides./.

Vietnam, US deepen agricultural ties

Vietnam’s Deputy Minister of Agriculture and Rural Development Hoang Trung met with US Deputy Secretary of Agriculture Hafemeister on August 28 in Washington D.C, as part of his visit to the US to accelerate market access for Vietnamese fruits, enhance plant protection collaboration, and advance sustainable agricultural practices.

A major highlight of the meeting was the mutual celebration of US peaches and nectarines gaining approval for export to Vietnam, marking a significant milestone in agricultural trade between the two nations.

Both sides also made substantial progress on other fruit market access issues, agreeing on technical standards for Vietnam’s passion fruit and advancing discussions on US’s mandarins.

Key outcomes included the finalisation of technical discussions, clearing the way for Vietnam’s passion fruit exports, and the initiation of market access procedures for other Vietnamese fruits such as seedless limes, guavas, and jackfruit.

The two sides also agreed on pest control measures and the next steps for US mandarins, plums, lemons, pomegranates, and others.

Deputy Secretary Hafemeister underscored the unprecedented level of cooperation with Vietnam and committed to further enhancing technical collaboration, particularly in disease control, risk analysis, and research.

He also pledged the US support for Vietnam in managing fertilisers, biological protection, and rice production in the Mekong Delta.

Deputy Minister Trung expressed optimism that the US will support Vietnam in trade defence consultations involving key agricultural products such as wood, warm-water shrimp, and honey. The US acknowledged the importance of these products to Vietnam’s rural economy and business interests.

The discussions also covered new approaches to phytosanitary measures, with both sides agreeing to adhere to international trade commitments while adapting to evolving trade and disease management trends. The US side pledged to assist Vietnam in implementing projects related to fertiliser management and biological protection.

Both sides agreed to adopt the ePhyto system for phytosanitary certification and explore diverse phytosanitary methods to reduce costs and facilitate trade. The US also endorsed Vietnam’s proposal for more diversified phytosanitary approaches and agreed to collaborate on the necessary trials.

On the occasion, Trung witnessed the signing of a Memorandum of Understanding between Cargill US and Vietnam’s Khai Anh Bnh Thuan company.

The agreement involves the import of 500,000 tonnes of corn and cornmeal for animal feed production in Vietnam, aiming to balance bilateral trade and diversify Vietnam’s feed production inputs.

This visit and the agreements reached reflect a deepening of the agricultural partnership between Vietnam and the US, with both countries committed to fostering stronger ties and promoting sustainable development in the sector./.

Deputy PM calls on Chinese firm to boost infrastructure cooperation with Vietnam

Deputy Prime Minister Tran Hong Ha received Executive Director of the China Communications Construction Company (CCCC) Wang Haihuai in Hanoi on August 28, asking the firm to make practical proposals for infrastructure, construction, transport, and agricultural cooperation to help realise the high-level agreements between the two Parties and countries.

Highly valuing the CCCC’s road, railway, and renewable energy infrastructure projects, Ha suggested the company proactively consider and take part in priority infrastructure development projects in Vietnam, especially the North - South high-speed railway, along with the Hanoi - Hai Phong - Lang Son and the Hanoi - Mong Cai - Lao Cai rail routes to connect Vietnam with Chinese localities and some other countries.

These are priority projects needing to be implemented as soon as possible, he noted, asking the CCCC to soon access Vietnamese partners and study both sides’ legal regulations to ensure the most effective collaboration in terms of design, technology selection, management, and operation, thus heralding a new stage of infrastructure development in Vietnam as well as for the company’s ties with Vietnamese partners.

The official spoke highly of the CCCC’s green transition and renewable energy facilities and technologies in China, expressing his hope that its cooperation in Vietnam will help local businesses access new technologies and govern more efficiently.

The CCCC’s facilities and projects in Vietnam will become symbols of the two countries’ relations and open up investment and business opportunities in other fields for the firm, he said.

For his part, Wang said over the last 30 years, his company has carried out more than 30 projects in Vietnam such as seaports, onshore wind power plants, and industrial parks with total contract value exceeding 3 billion USD.

Extensive integration, a favourable legal corridor, and a strongly improved investment climate are optimal conditions for foreign businesses to operate in the Southeast Asian nation, he opined.

He said the CCCC is closely following the important transport projects connecting Vietnam with Chinese localities, along with the North - South high-speed railway and metro lines in Hanoi and Ho Chi Minh City.

The Executive Director also voiced the readiness to carry out wind power projects using the most advanced technologies in Vietnam./.

Credit expected to achieve yearly growth target

Bank credit in August is showing signs of recovery after a decline in July, according to the State Bank of Vietnam (SBV).

As of August 16, credit had increased by 6.25% compared to the end of 2023, while by the end of July, credit increased by 5.66%, lower than the 6.1% rate recorded at the end of June.

In Ho Chi Minh City, credit in July reached 3.68 quadrillion VND (147.8 billion USD), down by 0.09% compared to the previous month, but up 11.47% year-on-year.

Deputy Director of the SBV’s HCM City Branch Nguyen Duc Lenh said that the slight decrease in credit in July was mainly due to the decrease in short-term credit and foreign currency credit.

However, Lenh believed that the socio-economic operation, production and business activities of enterprises, especially the sectors and fields that are economic growth drivers, are continuing to maintain a positive growth trend, which will be an important environmental factor to maintain and promote credit growth.

According to experts, credit growth in the first half of this year was supported by many factors, such as low lending interest rates and many interest rate preferential credit packages launched on a larger scale. Along with that, they were a driver from the recovery of production and positive signals from FDI, imports and exports.

Data released by the SBV shows in the first half of this year, interest rates for new and existing loans continued to decrease. By the end of June, the average lending interest rate was 8.3% per year, down 0.96 percentage point compared to the end of 2023. The average deposit interest rate was 3.59% per year, down 1.08 percentage points compared to the end of 2023.

Though there have been many increases in interest rates at banks, most of them are short-term interest rates, while medium-and long-term interest rates remain very low. At the same time, lending interest rates are still kept low according to the SBV's policy of supporting businesses and people.

It can be seen that with the current figures, the SBV’s target credit growth rate of 14-15% in 2024 is relatively challenging.

Previously, according to a survey on business trends in the second quarter of 2024 of the SBV’s Forecast and Statistics Department, credit institutions forecast that credit of the entire banking system will increase by an average of 3.8% in the second quarter of 2024 and 13.6% in 2024. Meanwhile, capital mobilisation of the system will increase by 3.5% in the second quarter of 2024 and 9.9% in 2024.

In fact, although credit has increased again since March this year, there is differentiation among credit institutions. Banks such as LPBank, OCB, HDBank and Techcombank, which specialise in corporate lending, have recorded high growth rates, while the group of retail banks have had lower credit growth rates./.

Electronics export bounces back impressively

Electronics export has witnessed vigorous recovery, posting double-digit growth over seven and a half months and expected to hit 130 - 132 billion USD in 2024.

As of August 15, Vietnam recorded 244.41 billion USD in total overseas shipments, rising 16% year on year. The revenue includes 77.4 billion USD from electronics exports, up 20%, helping this industry maintain its status as a leading foreign currency earner.

In particular, computers, computer devices, electronic products, and components brought home 42.59 billion USD while phones and components 33.8 billion USD, respectively increasing 30% and 11% from a year earlier, statistics show.

Do Thi Thuy Duong, member of the executive committee of the Vietnam Electronic Industries Association, said electronics export became stagnant last year with a turnover of about 110 billion USD due to impacts of global economic recession and the shortage of orders, but the situation has improved in 2024.

As electronic products and components make up an increasing proportion of total exports, their performance considerably affects overall export growth. During 2011 -2023, they posted an average growth rate of 23.8%.

This result is attributed to foreign invested businesses. Up to 99% of the industry’s total exports come from those firms, including large investors like Samsung, LG, Intel, and Apple.

Big investments from electronic giants have helped rapidly expand Vietnam’s smartphone market share globally to 13%, the second largest after China.

In its Investment Outlook for the second half of 2024, HSBC forecast Vietnam’s economic growth will remain on the recovery track in H2, driven by the global electronics cycle.

Signs of manufacturing and export recovery are being sustained as seen in the spending of foreign currencies on importing machinery, equipment, and some key commodities to serve export.

Electronics imports reached 64.15 billion USD as of August 15, rising nearly 29% year on year, according to the General Department of Vietnam Customs.

The country’s manufacturing industries have bounced back since the mid-year thanks to a surge in new orders.

The increased import of computers, electronic devices, and components is an indicator of abundant export orders, the Ministry of Industry and Trade explained.

If monthly exports are kept at 11.5 billion USD, overseas shipments of electronics are believed to yield 51.8 - 52.5 billion USD during the remaining months to raise this year’s figure to 130 billion USD and even higher./.

Vietnam, RoK bolster SME cooperation

Vietnam’s Ministry of Planning and Investment (MPI) and the Republic of Korea (RoK)’s Ministry of Small and Medium size Enterprises (SMEs) and Startups convened the first meeting of their bilateral cooperation committee in Hanoi on August 28, aiming to enhance collaboration between the two countries' SMEs and startups.

The formation of the cooperation committee follows discussions during Korean President Yoon Suk-yeol’s state visit to Vietnam in June 2023, where the importance of SME cooperation was highlighted. The committee is expected to foster mutual understanding among entrepreneurs and enhance collaboration in sectors where both countries have significant strengths.

During Prime Minister Pham Minh Chinh's visit to the RoK in July 2023, an MoU on SME and startup cooperation was signed, anticipated to create new opportunities for investment, trade, and business connections, contributing to innovation and sustainable development in both countries.

At the meeting, MPI Minister Nguyen Chi Dung expressed confidence that the committee's activities, supported by research institutes and SME associations, will lead to effective joint projects, particularly in high-tech agriculture, food processing, pharmaceuticals, semiconductors, and electronics. He also highlighted the importance of integrating Vietnamese SMEs into the RoK and global supply chains, reaffirming the ministry’s commitment to supporting business development.

The meeting served as a platform to discuss the development of SMEs in both countries and identify key areas for future support. Vietnam's Ministry of Planning and Investment encouraged the RoK businesses to expand investments in areas where the RoK excels and Vietnam has high demand, such as the digital economy, green economy, and emerging industries like semiconductors, AI, and hydrogen.

Minister Oh Young Joo of the Ministry of SMEs and Startups recognised the significance of the meeting as a step toward a new chapter in bilateral cooperation, expressing his hope for concrete plans to implement the MoU.

The RoK, a major investor in Vietnam since the 1990s, had invested nearly 87.5 billion USD across over 10,000 projects as of June 2024, making it Vietnam’s top investor.

Recently the RoK’s investments increasingly shifted toward high-tech industries, energy, finance, and high-quality services, reflecting a move from traditional manufacturing to more advanced sectors.

Vietnamese SMEs, meanwhile, are progressing in technology adoption and innovation, gradually climbing in the global value chain and forming partnerships with Korean companies.

The potential of Vietnam's SMEs spans various sectors, including manufacturing, electronics, agriculture, food processing, IT, textiles, and footwear./.

Gia Lai, Australia’s New South Wales state promote trade, investment cooperation

A workshop was held in Sydney on August 28 to promote the trade and investment cooperation between the Central Highlands province of Gia Lai and New South Wales state of Australia.

The event saw the participation of a delegation from Gia Lai province led by Deputy Secretary of the provincial Party Committee Chau Ngoc Tuan, Consul General of Vietnam in charge of New South Wales, Queensland and South Australia states Nguyen Dang Thang, and representatives of the Australia-Vietnam Business Council (AVBC), Vietnam Entrepreneurs Association in Sydney (VEAS), and companies from both countries.

Addressing the event, Tuan introduced the province’s advantages and potential for development, especially in high-tech agriculture, processing industry, renewable energy and tourism.

According to the Gia Lai planning for the 2021-2030 period, with a vision to 2050 approved by the Prime Minister, the province will be developed towards green growth, becoming an economic hub of the northern Central Highlands region and a driver in the Vietnam-Laos-Cambodia development triangle.

Consul General Thang said the workshop is an opportunity for both sides to discuss and boost cooperation areas such as renewal energy, tourism, high-quality agriculture, and affirmed the Vietnamese Consulate General in Sydney will continue supporting and accompanying Vietnamese localities to promote economic diplomacy, connecting Vietnamese provinces with New South Wales, South Australia and Queensland.

Chairman of the AVBC Marco Zammarrelli said that the council will continue to facilitate dialogues between the two sides' businesses, create favourable conditions for businesses to play an active role in promoting the development of the Australia-Vietnam relationship, and encourage and accelerate scientific, technological, academic and cultural exchanges between the two countries.

Harry Tran, a representative from the VEAS said that the workshop offers a good opportunity for businesses in Australia to meet directly with leaders of Gia Lai province, to get useful information about the province's development potential.

Meanwhile, it is also an opportunity for businesses in Gia Lai province to learn about Australia's strengths, and connect with partners in Australia. He also shared with the delegation his experience in attracting Australian investors.

At the workshop, participants watched some clips introducing Gia Lai's potential, strengths, and outstanding businesses./.

Banks issue bonds to raise long-term capital, adhere to regulations

Commercial banks are seeking to issue bonds to raise long-term capital while adhering to capital safety regulations set by the central bank.

Banks issued bonds totalling 27 trillion VND (1.15 billion USD) last month, or 87% of total corporate bond issuance in the market and double the amount recorded the same time last year, according to a report by local credit rating agency FiinRatings.

Banks issued bonds worth 169 trillion VND as of the end of July with major issuers including MBBank (10 trillion VND), Vietinbank (5 trillion VND), and SHB (3 trillion VND).

“Banks are consistently issuing bonds to bolster their Tier 2 capital in compliance with the regulations set forth by the central bank,” according to another credit rating agency, VIS Rating.

Projected bond issuances for the remaining months of the year include plans from Vietinbank (8 trillion VND), LPBank (6 trillion VND), ACB (15 trillion VND), SHB (5 trillion VND), and BIDV (4 trillion VND), among others.

Last month, fully state-owned Agribank announced plans to issue 10 million bonds to the public, with a total value of 10 trillion VND.

The interest rate on these bonds is set to be 2% higher than the average 12-month savings deposit interest rate offered by the four largest state-owned commercial banks (Agribank, Vietinbank, BIDV, and Vietcombank) for the first five years, and 3% higher for the remaining five years.

Based on current interest rates, this rate may exceed 6% annually in the first year.

The bond issuance aims to secure long-term capital to address the economy’s demand for loans.

These bonds may also serve as collateral for bank loans at preferential interest rates.

The central bank has mandated a reduction in the maximum ratio of short-term capital allocated for medium- and long-term lending to 30%, down from the previous limit of 34%.

It has also stipulated that loans must not exceed 85% of total mobilised capital.

The stringent regulations on credit safety limits and adequacy for medium- and long-term capital set by the central bank is pushing banks to issue bonds.

Amid slowing deposit growth attributed to low interest rates, banks are increasingly seeking alternative funding sources through the bond market.

VIS Rating has projected a requirement of 283 trillion VND of capital-raising bonds over the next three years for banks to maintain internal capital and comply with safety ratios.

The central bank has set a credit growth target of 14-15% for this year. Credit reached nearly 14.4 quadrillion VND in the first half, up 6% since the beginning of the year.

Non-performing loans within the banking system rose by 75.9 trillion VND in the first five months, according to the latest data from the central bank.

The bad debt ratio of the banking system stood at 4.94% as of the end of May, up from the 4.55% at the end of last year, according to the data./.

Vietnam, RoK promote measures boost trade

National Assembly (NA) Vice Chairwoman Nguyen Thi Thanh received in Hanoi on August 28 visiting Minister of Small- and Medium-sized Enterprises and Startups Oh Young Joo of the Republic of Korea, proposing the guest continue coordination with Vietnamese agencies to strengthen economic cooperation and promote the implementation of measures to increase bilateral trade.

She also suggested the Korean side continue supporting Vietnamese enterprises to increase capacity so that they can further participate in global supply chains, especially Korean enterprises’ ecosystem, as well as carry out human resources training projects for Vietnam in the fields of high-tech, digital transformation, semiconductor industry and artificial intelligence.

The NA Vice Chairwoman said that Vietnam wishes to cooperate the RoK to develop large-scale, long-term projects, that are symbolic for bilateral cooperation, while continuing to promote defence cooperation and enhance capacity of law enforcement at sea for Vietnam.

She hoped the Rok to create favourable condition for Vietnam to open the Vietnamese Consulate General in Busan city in 2024, and support the implementation of a Vietnam cultural centre in the RoK, as well as share experience in developing the cultural industry and entertainment industry.

For her part, Minister Oh said she hopes for the more deeper and substantial cooperation between the two countries, and between their small and medium-sized enterprises in particular.

She pledged to make further efforts to contribute to developing bilateral cooperation in the area.

Speaking highly of Vietnam's action plans, the minister expected that cooperation between the two countries' enterprises will be strengthened, contributing to innovation, technology transfer to Vietnamese businesses after this visit.

She said her ministry has issued a new policy that helps international students with good academic achievements to have more opportunities to work long-term in the RoK.

As many Vietnamese students are studying in the RoK , she hoped the two sides will continue to cooperate in human resources, thereby contributing to the development of economic and trade collaboration between the two countries./.

Da Nang to boost investment, tourism with Malaysia

The central city of Da Nang is actively fostering connections and inviting investment from Malaysia to collaborate on various initiatives, including its international finance centre, a free trade zone, tourism, digital transformation, and healthcare.

Additionally, a new air route connecting Da Nang and Kuala Lumpur is set to commence on September 24.

The new route will be operating with seven flights per week by Malaysian Airlines, making it the third route on Da Nang-Kuala Lumpur route after Air Asia and Batik Air, meaning an increase to 28 flights per week.

Vice Chairwoman of the municipal People’s Committee Nguyen Thi Anh Thi said at a working visit with the Vietnamese Embassy in Malaysia, that Da Nang hopes to build links with the southern state of Malacca, with investments in finance and healthcare management.

Thi said Da Nang needs experience sharing from Malaysian partners in building the Malaysian International Financial Centre at Tun Razak Exchange and the free trade zone in Port Klang Tanjung Pelepas.

Da Nang plans to build a free trade zone and the establishment of municipal authority – the first ever of its kind in Vietnam – with an international finance centre to attract investment over the coming decades.

A tourism promotion event was held by the city’s tourism foundation with the participation of 100 travel agencies from Da Nang and Malaysia, offering more exchange tours.

Malaysian tourists are listed in top ten of international travellers to Da Nang with 75,000 visitors in the first seven months of 2024.

Da Nang City’s tourism department will reserve thousands of vouchers for tourists visiting the city in the last months of 2024.

Last month, Malaysia introduced a tourism promotion programme – ‘Discovery Malaysia' – in Da Nang and Ho Chi Minh City. Malaysia currently welcomes 146 flights from Vietnam every week.

Da Nang has drawn 18 investment projects from Malaysia with total 222 million USD, the city’s investment promotion agency reported.

The new air route will connect tourists to the UNESCO-recognised world heritage sites in central Vietnam such as Hue Monuments complex in Thua Thien-Hue province, the My Son Sanctuary and Hoi An ancient town in Quang Nam province with destinations in Malaysia, according to the city’s Tourism Fund./.

HCM City launches sale promotion programme of branded products

The Department of Industry and Trade of Ho Chi Minh City on August 28 announced the launch of a programme to boost the sale of branded goods named “CITY SALE 2024”, which offers discounts of up to 80%.

This event is part of the Shopping Season 2024, a series of promotional programmes in the city.

Vice Director of the department Le Huynh Minh Tu said CITY SALE 2024 is one of the practical activities to stimulate demand and shopping in HCM City, contributing to the total retail sales of goods and service revenue of the southern hub, connecting businesses with consumers.

The scale of CITY SALE 2024 will be expanded, with simultaneous events held at three strategic retail locations in HCM City.

It will feature luxury products from over 500 renowned international and Vietnamese brands which will primarily showcase products in categories. Some major brands will also offer billions of VND worth of unconditional cashback vouchers and thousands of attractive gifts for consumers during CITY SALE 2024.

Nguyen Khac Hieu, a representative of the organising board, said with the policy of "cashless shopping", the department has cooperated with two payment gateways VNPAY and ZALOPAY to sponsor additional discount vouchers for consumers. Xanh SM will also sponsor customers with travel routes to the three localities.

The event is expected to boost the retail industry and turn HCM City into an attractive shopping and tourism destination for both domestic and international visitors, Hieu added.

The programme with take place from August 30 to September 3./.

Khanh Hoa looks to foster tourism cooperation with India

Nha Trang city in the south-central province of Khanh Hoa hosted the India-Khanh Hoa tourism promotion conference on August 28, drawing more than 300 delegates.

Addressing the event, part of the Namaste Vietnam Festival 2024 from August 25-31, Standing Vice Chairman of the People’s Committee of Khanh Hoa Le Huu Hoang said that the conference provides a chance for the two sides to introduce each other’s tourism sector, and a venue for management officials and travel firms of Khanh Hoa and India to discuss tourism cooperation.

Khanh Hoa is keen to collaborate with Indian producers, directors, and artists to introduce the province’s culture and tourism in Indian cultural and cinematic products, initially the movie titled “Love in Vietnam” - the first to be made with the diplomatic cooperation between Vietnam and India scheduled to start in September 2024.

Indian Deputy Consul General in Ho Chi Minh City Tushar Garg described the conference as a cultural event to strengthen the relations between India and Vietnam.

He held that the Namaste Vietnam Festival, which introduces the diverse cuisines and attractive tourism of India, shows the commitment of the two sides in promoting bilateral tourism cooperation, especially between India and Khanh Hoa - a coastal locality that shares similarities with many Indian destinations.

According to the Khanh Hoa Department of Tourism, with more than 1,180 facilities and over 64,000 accommodation rooms, along with many historical relics, beautiful landscapes, and unique tourism products, Khanh Hoa can satisfy Indian tourists.

Tran Hoang Linh from Vietjet Air said that the carrier is operating seven direct air routes between Hanoi, HCM City and four cities of India. Vietjet hopes to open a direct route from Cam Ranh airport in Khanh Hoa to India to meet the needs of tourists of the two sides, he said.

Abhineet Shukla, head of the Indian tourism delegation, said that the conference helps the tourism sectors of India and Khanh Hoa define potential cooperation areas such as MICE (meetings, incentives, conferences and exhibitions), luxury travel, and weddings.

Director of the Khanh Hoa tourism department Nguyen Thi Le Thanh pledged that the locality will create optimal conditions for Indian travel firms to bring tourists to the locality, while strengthening the communications work to draw more Indian tourists.

Later the same day, the Indian delegation gathering more than 30 Indian firms joined a famtrip to Vinpearl Harbour Nha Trang entertainment site and a number of tourist attractions in Nha Trang.

According to the provincial Department of Tourism, so far this year, Khanh Hoa has attracted more than 8 million visitors, up 61% year on year, including over 3.2 million foreigners, more than 2.6 times higher than that in the same period last year. However, the number of tourists from India, a country with a population of 1.4 billion and more than 30 million people travelling abroad each year, has remained modest.

Meanwhile, on August 28, the Trang An Eco-tourism Site in the northern province of Ninh Binh welcomed more than 800 Indian tourists.

This is the first among the seven groups of a 4,500-member tourist delegation that is scheduled to tour Ninh Binh from August 28 to September 5. According to Pham Duy Phong, Deputy Director of the Ninh Binh Tourism Department, the selection by massive international tourist groups affirms and boosts the locality as an attractive and prestigious destination in the international tourism map. The event is also a golden chance for the province to bring into play its advantages and to popularise its image, scenic beauties, and culture to the world, especially India, he said./.

Source: VNA//VNS/VOV/SGGP/VGP