Under the resolution, HCM City will become a modern service-industrial city, a leader in digital economy, and an economic, financial, commercial, cultural, educational, scientific and technological center of the whole country.

By 2030 it aims to achieve economic growth of 8 - 8.5%/year, with the gross regional domestic product (GRDP) per capita reaching about US$14,500, and the digital economy making up 40% of its GRDP.

By 2045, HCM City will develop on par with major cities in the world, become an economic, financial and service center in Asia, and work as an attractive global destination.

To meet the goal, the Politburo requested that HCM City focus on fast and sustainable economic development on the basis of innovating the growth model, restructuring the economy, and improving productivity, quality, efficiency and international competitiveness, while mobilizing and effectively using all resources.

The Politburo also requested the city to improve the quality of urban planning, management and implementation, step up sustainable urban development and climate change adaptation, and promote the construction of synchronous and modern infrastructure.

Priority will be given to developing synchronous and modern transport, energy and telecommunications infrastructure, completing the construction of national highways and a system of regional and inter-regional roads, and speeding up investment in construction of national key projects, including the upgrade of Tan Son international airport.

The city of Thu Duc, part of HCM City, will strive to become a new growth pole, an innovative, highly interactive city, and the nucleus of the city’s socio-economic development.

The Politburo also requested HCM City to develop a breakthrough mechanism to attract development investment resources and promote socialization in the fields of health, education and training, culture and sports. It permitted the city to pilot the selection of investors through the public-private partnership model to implement investment projects in the fields of culture, sports and science and technology.

The Politburo held that HCM City review the implementation of the urban government model, and at the same time continue to perfect its apparatus in a modern, effective and efficient manner.

Vietnam forms corporation on securities management

Deputy Prime Minister Le Minh Khai has just signed Decision No.26/2022/QD-TTg about the establishment and operation of VSDC.

Vietnam Securities Depository and Clearing Corporation (VSDC) is upgraded from Vietnam Securities Depository (VSD), with the headquarters in Hanoi and main brand office in Ho Chi Minh City.

VSDC is responsible for

_providing information related to securities ownership of stockholders in public companies

_issuing securities as requested by public companies

_monitoring registration, depository, clearing and settlement services for securities

_monitoring the ownership proportion of foreign investors in accordance with the law on securities and securities market

_monitoring the compliance with obligations of VSDC’s members

Construction industry's growth rate surpasses set plan

Despite being affected by general difficulties, the growth rate of the construction industry achieved about 8-8.5% this year, contributing to bringing the economy's overall growth rate surpassing the 6-6.5% plan set by the Government.

Timely control of the real estate market is one of the recognised successes in the State management of the Ministry of Construction.

The Ministry of Construction has comprehensively assessed the market to point out the shortcomings and propose solutions to ensure the real estate market's safe, healthy and sustainable development.

The Minister of Construction Nguyen Thanh Nghi has worked immediately with several localities such as Hanoi, Ho Chi Minh City, Da Nang, Can Tho, Hai Phong and real estate businesses to review, urge and guide to remove difficulties and obstacles in project implementation.

Along with regularly monitoring market developments, the Ministry of Construction proactively informs, forecasts and promptly takes measures to respond to abnormal market fluctuations, and promptly handles "hot" issues.

Typically, it has reported to the Prime Minister and the Standing Committee of the National Assembly's Economic Committee on the impact of the unusually-high land use right auction winning results on the real estate market; proposed several solutions related to the amendment of policies and laws on auction and strengthen the management, inspection and handling of violations in the auction of land use rights in the localities.

In addition, the ministry coordinated with the State Bank of Vietnam to assess the situation and evolution of capital flows into the real estate market and propose appropriate solutions.

The real estate market has shown signs of recovery and development, with the total number of transactions of apartments, individual houses and land plots higher than last year.

The product absorption rate in most segments is high, and the rate of office vacancy and commercial space for rent gradually decreased.

The market has re-balanced between investment and business activities, and buying and selling for use. However, the market still faces a supply shortage in all product segments, an inappropriate structure of goods, a severe lack of affordable social and commercial housing, and high transaction prices.

Real estate supply is limited in all segments. Transaction prices in many segments remained at a high level at the end of the second quarter of this year, affecting the liquidity and trading volume of the market, especially the secondary market.

To "take the reins" of the real estate market, Minister Nghi requested to review and reduce procedures in the direction of reform to "open up" investment activities but still ensure compliance with legal regulations.

The minister asked to continue to study and develop mechanisms, policies and solutions to encourage and attract foreign investment into the real estate market in the coming time, overcome the supply-demand mismatch of real estate products, focus on promoting the development of real estate products to meet the significant needs of the society such as social housing, commercial housing at reasonable prices.

At the same time, he also noted to complete and regularly maintain information systems and databases on the housing and real estate market; regularly follows the real estate market situation to adjust and promptly remove difficulties caused by limitations and inadequacies of mechanisms, policies, laws; natural disasters; impacts of the COVID-19 pandemic on real estate market; to ensure the stable and healthy development of the market.

These "supports" were the leverage to help the construction industry complete the year's tasks and proactively identify the new year's challenges to maintain a sustainable growth rate, said Nghi.

Vietnam rides through economic difficulties

Under the sound leadership of the Party Central Committee and with the motto “Solidarity, discipline, active adaptation, safety, efficiency and economic recovery”, the Government and the entire country have overcome challenges and reaped achievements in all spheres, laying foundation for 2023 and subsequent years.

With COVID-19 under control, the macro-economy remained stable, inflation below 4% and major balances of the economy guaranteed. The GDP grew 8.02%, higher than the set target of 6-6.5%. The disbursement of foreign direct investment hit nearly 21 billion USD, up over 8% annually.

Data from the General Department of Vietnam Customs showed that the country’s total export-import turnover went up 12.18% to around 750 billion USD. The results were impressive amid weakening growth, inflation and spiraling living costs in the world.

Economic sectors witnessed considerable growth, including agro-forestry-fisheries. Industrial production expanded by 8.6% in 11 months of 2022 while the total retail of goods and consumption services soared by 20.5%. As many as 195,000 new businesses entered the market, up 33.2% in volume.

Many countries, international organisations and prestigious financial institutions continued speaking highly of Vietnam’s efforts to perform macro-economic policies and overcome external shocks.

In the Global Innovation Index 2022, Vietnam ranked 48th out of 132 economies, second out of 36 low middle-income countries, and 10th out of 17 Southeast Asian and Pacific nations.

World top organisations Standard & Poor’s Global Ratings, Moody's, and Fitch Ratings gave positive credit rankings for Vietnam. Notably, on September 6, Moody’s Investors Service upgraded Vietnam’s long-term issuer and senior unsecured ratings to Ba2 from Ba3 and changed the outlook to stable from positive. Vietnam was the only in Asia-Pacific and one of the four countries globally to have ratings upgraded by Moody’s at that time.

In addition to recovery, socio-economic growth, political security, as well as social safety and order were ensured; people’s life was improved; and defence-security was well maintained. In addition, the practical and effective promotion of diplomatic activities and integration helped consolidate Vietnam’s prestige and position in the international arena.
 
With a motto of leaving no one behind, the Government spent some 87 trillion VND (3.68 billion USD) on aiding close to 56 million employees and people as well as 730,000 employers affected by COVID-19. Meanwhile, sustainable poverty reduction was prioritised, with the rate of poor households estimated to drop by approximately 1%.

Deciding to reopen its door in the year, Vietnam successfully hosted the 31st Southeast Asian Games (SEA Games 31). The Vietnamese contingent reaped myriad medals and a high ranking on the tally, contributing to promoting the image of a friendly, safe, and energetic nation that is recovering strongly after the pandemic.

This year, the global situation is forecast to face more complicated developments, difficulties, and challenges than advantages and opportunities. With successes obtained in 2022, the Vietnamese Government is determined to boost concerted efforts for new achievements.

First cargo welcomed in Hai Phong, Da Nang

Three terminal branches of Hai Phong Port JSC in the northern port city of Hai Phong on January 1 welcomed first cargo of 2023.

This is one of its annual traditional activities to stimulate production and trade in the beginning of the new year.

The first cargo at Tan Vu terminal branch were from Maersk Line’s Nordmaas vessel. Meanwhile, container cargo and bulk cargo arrived at Chua Ve and Hoang Dieu terminal branches, respectively.

Last year, Hai Phong port developed two new service routes of Cosco and Zym shipping lines connecting Hai Phong with China. In January 2023, the port is expected to welcome one more service route of Maersk Line, bringing the total number of service routes connecting to the port to 17.

At 0am on January 1, Da Nang Port JSC also held a ceremony welcoming the first tonne of cargo to Tien Sa port, which was handled from 12.649 DWT Haian Park of Vietnam and Panama’s 33.577 DWT Ever Optima vessel.

Some sectors to benefit, others to suffer from China’s reopening: Report

China has officially announced the easing of COVID-19 prevention measures which have been imposed for three year, and experts have said this is expected to kickstart the country's economic recovery, opening opportunities for some Vietnamese sectors in the medium term.

In a recent report, Agribank Securities Company (Agriseco) said Vietnamese businesses will benefit when China opens its doors and resumes flights between the two countries.

According to Agriseco Research, business groups that can benefit include mechanical engineering, textiles, footwear, electronics, pangasius processing, and automobiles. On the other hand, the prices of some input materials may increase again when demand recovers, such as iron and steel, cement, and base metals.

In addition to the groups that benefit, Agriseco's report also shows disadvantaged groups. For example, experts recommend that investors follow China's output recovery in the fertiliser and chemical industry.

Agriseco analysts point out that when China opens up its economy, it can restore production and remove export restrictions, causing fertiliser prices to continue to fall in 2023. China is the world's leading fertiliser exporter.

However, the country's production cuts created opportunities for Vietnamese businesses to increase their exports strongly in the past two years. Businesses like PetroVietnam Fertiliser & Chemicals Corporation (DPM) and PetroVietnam Ca Mau Fertiliser JSC (DCM) have record growth in business results in 2022. These advantages may be lost if China restores production.

With the above assessment, Agriseco forecasts that the business results of fertiliser enterprises may go backwards in 2023 as fertiliser prices continue to cool down, and there may be a decline in export activities.

Agriseco Research believes that the business results of chemical enterprises will likely go backwards in 2023 due to the cooling of chemical prices and the restoration of production in China, making export activities more competitive.

Tet bonuses increase 
 
The Ministry of Labour, Invalids and Social Affairs has predicted a 10 percent rise in Tet bonuses for coming Lunar New Year.

According to the ministry, cities and provinces nationwide have reported on salary and Tet 2023 bonuses. The average bonus for the coming New Year would be VND1.2 million (USD50.84), down 14 percent on-year. The state-owned sector will offer the highest bonus with VND2 million, followed by the foreign-invested sector with VND1.5 million. 

The Ministry of Labour, Invalids and Social Affairs predicts a 10 percent rise in Tet bonuses for coming Lunar New Year

HCM City tops nationwide in the New Year bonus with VND606 million. Ben Tre comes after with VND332 million, Bac Ninh with 257 million and Hanoi VND125 million.

Meanwhile, the average bonus for Tet 2023 will be roughly 10 percent up. The highest level of VND7.2 million belongs to foreign-invested firms, followed by state-owned enterprises with VND6.5 million.

A company in Danang has announced a Tet bonus of up to VND1 billion. The runners-up are Binh Duong with VND896 million, HCM City with VND760 million, Ba Ria-Vung Tau with 535 million, Hanoi with VND400 million, Bac Ninh with VND379 million and Dong Nai with VND307 million.

The lowest Tet bonus is VND50,000.

Fuel prices rise again after four cuts

After dropping four times in a row, fuel prices saw an uptick yesterday, January 1.

RON 95-III now sells for VND21,800 per liter, up VND1,100 against the earlier session, and E5 RON 92 is priced at VND21,020, increasing nearly VND1,050.

Diesel oil rose by VND550 to VND22,150 per liter, while kerosene edged up VND330 to VND22,160 per liter.

Heavy oil also inched up by VND770 to VND12,860 per kilogram.

A new environmental protection tax will be applied.

According to the Ministry of Industry and Trade, the National Assembly’s steering committee has approved Resolution 30/2022, amending the environmental protection tax on gasoline and oil products.

Accordingly, the new rate for gasoline products, except for ethanol, increased by VND1,000, as prescribed in Resolution 20/2022, to VND2,000.

The tax on diesel oil and kerosene rose by VND500 and VND300 to VND1,000 and VND600 per liter, respectively, while heavy oil, lubricating oil and grease inched up VND700 to VND1,000 per liter or kilogram each.

The rate for jet fuel remains the same, at VND1,000 per liter.

The resolution took effect on January 1, 2023, and will expire on December 31.

Vietnam’s seaports handle 733 million tons of cargo in 2022

Cargo throughput of Vietnam’s seaports in 2022 has amounted to 733.18 million tons, a 4% increase against 2021, said Hoang Hong Giang, deputy head of the Vietnam Maritime Administration.

Exports have reached 179.07 million tons, down 3%, and imports have totaled 209.26 million tons, a 2% decrease, while domestic cargo amounted to 342.79 million tons, rising 12% over last year.

The total volume of container goods put through the seaports has amounted to about 25.09 million TEUs, up 5% compared to 2021.

According to the Vietnam Maritime Association, the 4% rise in cargo throughput at the seaports is the lowest growth rate in recent years.

Representatives of the Vietnam Maritime Association attributed the slow growth of cargo throughput to the late resumption of local enterprises’ manufacturing and export-import activities and the zero-COVID policy of China.

Despite the slow growth, Vietnam’s seaport activities have been highlighted by the fact that three seaports in Haiphong, HCMC and Ba Ria – Vung Tau are listed in the top 50 seaports with the highest cargo throughput in the world in 2022.

Exporters expect difficult year ahead

Many exporters are finalising their last orders in 2022 with their minds concerned about an anticipated tough year ahead.

The last months of the year are often the peak season for import and export activities to serve soaring consumption during the Christmas and New Year season, but this year it did not happen.

According to Tran Nhu Tung, chairman of the Board of Directors at Thanh Cong Textile Garment Investment Trading JSC (TCM), a majority of textile apparel firms exporting products to the US and EU markets are experiencing a decline in order intake due to still high unsold stock facing their business partners. Meanwhile, inflation has caused consumer demand to reduce.

As for TCM, although the company’s post-tax profit for the whole year 2022 surpassed $12 million, showing a 15 per cent jump over the plan approved by the general shareholder meeting, this resulted from prosperous business in the first half of the year.

Tung said that from the end of the third quarter, TCM had faced a decline in orders, especially from the US. Not only textile products but other key exports such as seafood, wood, and leather shoes also faced a decrease.

November was the first month this year when seafood exports declined (down over 14 per cent) compared to last year's period, falling by $780 million.

Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers, said that the world economy was forecast to face mounting difficulties, with the seafood industry being one of the most directly affected.

According to Hoe, many seafood enterprises recorded negative growth in the last two months this year, and this situation may persist in the first quarter of 2023.

The situation might improve from the end of Q1 next year when uncertainties in Vietnam’s major export markets, such as the US and EU, gradually lessen.

A representative of An Giang Fisheries Import-Export JSC (AGF) said that at this time, the company is managing to maintain operations to keep orders.

In the face of inflation, consumers have to tighten their spending, and AGF has shifted into producing value-added items in the middle segment.

An apparel firm listed on HSX said that the company’s orders in Q4 this year had dwindled compared to the first three quarters, especially compared to the first half. That was due to softened demands in the US, its key export market.

Accordingly, the company’s order intake in Q4 shed 10 per cent compared to Q3 but was 30 per cent lower compared to Q2, equivalent to about a 20 per cent revenue decrease compared to last year.

According to VNDirect Securities, Vietnam's export value would expand 9-10 per cent in 2023, decelerating compared to the 14 per cent growth in 2022.

Tran Khanh Hien, analysis director at VNDirect Securities, noted that demands in Vietnam's leading export markets, such as the US, EU, and even China, have tended to fall since the end of Q3 and would further decrease in 2023, badly affecting exports.

VNDirect expects Vietnam's trade surplus to increase to $12 billion in 2023 from an estimated $10.4 billion in 2022.

According to Garmex Saigon JSC’s leader, the pressure on the domestic interest rate and the exchange rate could last until the second quarter of 2023. It should ease significantly when the US Federal Reserve shifts monetary policy to a more neutral stance.

Many businesses believe that the export market will be fraught with difficulties in the first half of 2023 but will be somewhat stable from the middle of the year.

Encouraging signs for 2023

A rebound in trade and local production is expected to drive the Vietnamese economy in the year ahead following positive growth in 2022.

Experts and government officials have acknowledged the encouraging outcomes that were attained in the macroeconomic picture last year, especially in the context of increased geopolitical tensions and difficulties in global markets seriously affecting the performance of the Vietnamese economy.

According to the GSO, the economy is estimated to climb 5.92 per cent on-year in Q4, higher than the on-year 5.17 per cent in the same period of the previous year.

The growth rate for the whole 2022 is estimated to be 8.02 per cent – with an expansion of 5.03 per cent for Q1, 7.72 per cent for Q2, and 13.67 per cent for Q3. Such increases have reflected domestic production strongly bouncing back from 2021.

In 2022, the growth rate was 3.36 per cent for the agro-forestry-fishery sector (higher than 2.58 per cent in 2021), 7.78 per cent for industrial and construction (higher than 4.05 per cent in 2021), and 10 per cent for the service sector (higher than 1.22 per cent the previous year).

The GSO reported that the economy’s 12-month commodities export-import turnover is estimated to be $732.5 billion – up 9.5 per cent on-year. Export turnover stood at $371.85 billion – up 10.6 per cent, and the import turnover stood at $360.65 billion – up 8.4 per cent. There has been a trade surplus of $11.2 billion for the whole year - which is contrary to the trade deficit of $1 billion that was expected earlier in 2022.

Vietnam consecutively recorded a trade surplus in 2022, at $809 million in Q1, $1.28 billion after six months, $5.7 billion after nine months, and $10.6 billion after the first 11 months.

All trade achievements have been thanks to consumers’ high spending, and tax reduction and removal under free trade agreements’ commitments, the GSO said.

The key contributor to the trade surplus in 2022 is foreign-invested enterprises (FIEs). Their total export-import turnover was $511.62 billion, including $276.76 billion in export turnover (including crude oil exports) – up 12.1 per cent over the corresponding period last year, and $234.86 billion in import turnover – up 7.5 per cent on-year. FIEs’ 2022 trade surplus hit $41.9 billion - up from $29.36 billion recorded in the previous year.

According to the GSO, the biggest driver of Vietnam’s export turnover is the shipment of mobile phones and their spare parts, which fetched $ 59.29 billion, up 3.1 per cent on-year.

Manufacturers of computers, laptops, and many other electronic products, such as Samsung, LG, Canon, and Intel have exported these products with total turnover of $55.24 billion in 2022, up from $51 billion in 2021.

In the January-December 20 period, the total registered foreign direct investment hit $27.72 billion, down 11 per cent on-year, and disbursed capital touched $22.4 billion, up 13.5 per cent on-year.

In Q4, the number of newly established businesses reached 148,500 registered at $69.17 billion, using 981,300 new labourers. These are up 27.1 per cent in the number of enterprises, down 1.3 per cent in capital, and up 14.9 per cent in labourers.

FocusEconomics is seeing great potential for Vietnam’s industrial production. It said, “Of the key subsectors, manufacturing growth remained by far the strongest, supported by the country’s attractiveness as a low-cost manufacturing base for foreign firms - particularly those looking to diversify supply chains away from China. Meanwhile, the trend improved sizably, with the annual average growth of industrial production coming in at 16 per cent in November, up from October’s 15.3 per cent.”

FocusEconomics Consensus Forecast panellists estimated that Vietnam’s industrial output will grow 6.8 per cent in 2023 and 7.9 per cent in 2024.

According to the GSO, Vietnam’s added value of industrial production climbed 7.69 per cent for the whole of 2022, up from 4.82 per cent in 2021. The manufacturing and processing sector increased 8.1 per cent over the same period the previous year, when this sector climbed only 6.37 per cent.

Over a week ago, HSBC raised its 2022 growth forecast for Vietnam from 7.6 to 8.1 per cent, a prediction that if manifested would make the country the second-fastest growing economy in ASEAN behind Malaysia.

Despite regional and global gloom, the Asian Development Bank (ADB) with its own calculations has revised up its economic growth forecast for Vietnam to 7.5 per cent in 2022, from 6.5 per cent as projected in September.

ADB experts noted that while the Vietnamese economy is now performing well amid global uncertainties, risks to the country’s economic outlook have expanded. The bank said that although domestic trade continues to increase, there are indicators of weakening global demand for the country’s exports. Moving forward, growth for 2023 has therefore been adjusted down to 6.3 per cent as major trade partners weaken.

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