Trade surplus returns in second half of July

Speaking at an MPI meeting last week, Nguyen Van Trung, Deputy Minister of Planning and Investment, said the FDI sector had helped rebuild the country’s economy, increase export turnover, expand Vietnam’s reach to world markets, generate jobs, acquire technology transfers, management skills and attain global economic integration. The MPI report will include results from different ministries and departments, experts and business associations in terms of FDI attraction and management. The report will go into details on other key issues related to FDI, such as support industries, technology transfer, infrastructure, the high-tech agriculture and service sectors, as well as preferential policies and taxation, and prospects for the future. According to MPI data, accumulated capital invested in Vietnam to the end of July 2017, has reached US$307.86 billion in registered capital and $163.9 billion in actuality. These capital flows are divided across 19 branches of the economy over 63 cities and provinces. Some notable branches include the manufacturing sector with $181.8 billion in FDI, the real estate sector with $51.6 billion, and the electronics sector with $18.4 billion in the last three decades. Out of the 122 countries and territories whose multinational corporations have set up production in Vietnam, the Republic of Korea takes the lead with $55.26 billion in FDI, followed by Japan at $46.47 billion and Singapore with $41.6 billion. Many other countries with strong financial ability have expressed their intention to increase investment in Vietnam, such as the US and China. At present, more than 23,000 FDI companies are…... [read more]

Germany’s B.Braun Viet Nam factory in Thanh Oai Industrial Zone, Ha Noi. — VNA/VNS Photo Danh LamGermany’s B.Braun Viet Nam factory in Thanh Oai Industrial Zone, Ha Noi. — VNA/VNS Photo Danh Lam Viet Nam’s Ministry of Planning and Investment (MPI) is drawing up a report summing up 30 years of foreign direct investment (FDI) since approval of the national Law on Foreign Investment, looking back at the impact of opening the country’s doors to multinational companies. Speaking at an MPI meeting last week, Nguyen Van Trung, Deputy Minister of Planning and Investment, said the FDI sector had helped rebuild the country’s economy, increase export turnover, expand Viet Nam’s reach to world markets, generate jobs, acquire technology transfers, management skills and attain global economic integration. The MPI report will include results from different ministries and departments, experts and business associations in terms of FDI attraction and management. The report will go into details on other key issues related to FDI, such as support industries, technology transfer, infrastructure, the high-tech agriculture and service sectors, as well as preferential policies and taxation, and prospects for the future. According to MPI data, accumulated capital invested in Viet Nam to the end of July 2017, has reached US$307.86 billion in registered capital and $163.9 billion in actuality. These capital flows are divided across 19 branches of the economy over 63 cities and provinces. Some notable branches include the manufacturing sector with $181.8 billion in FDI,…... [read more]

NDO – Despite remarkable achievements in export activities, it is time to develop a new, sustainable, and effective export strategy for restructuring and maintaining positive economic growth, amidst increased challenges from both home and abroad, economist Vu Dinh Anh has suggested. In the context of the economy facing difficulties, especially low growth rates and a slow process of restructuring compared to the set plan, Vietnam’s exports in the first seven months of 2017 recorded remarkable progress, creating a positive premise for fulfilling the set target of annual export growth. However, the situation still mixes both joy and concern regarding the quantity and quality, as well as the structure. After seven months, the total export turnover has reached US$115.2 billion, up 18.7% over the same period in 2016 - far exceeding the set target of approximately 10% for the whole year, with a surprise in the exports of fruit and vegetables reaching their highest growth of 44.4%, worth US$2 billion; followed by the export of electronics, computers and spare parts (up 43.3%, reaching US$13.6 billion). It is noteworthy that exports of machinery, equipment and other spare parts increased by 29.5%, to US$6.9 billion, along with transportation means and spare parts reaching US$4 billion, an increase of 20%. Whilst still accounting for the largest share of total exports with US$22.6 billion, exports of phones and related components slowed down and rose by just 15%. In the same group, with export growth rates lower than that of the common trend, are textiles and…... [read more]

Total export turnover between Vietnam and ASEAN countries has increased seven-fold in the 20 years since Vietnam became a member of the bloc, according to a recent report from the General Department of Vietnam Customs summarizing Vietnam - ASEAN trade over the two decades.  ASEAN has continually been an important trading partner of Vietnam and the bilateral trade relationship has been growing. Trade value increased 12.3 per cent annually between 1996 and 2006 and 8.1 per cent each year from 2007 to 2016. Total export turnover stood at $41.49 billion in the 20-year period, accounting for 11.8 per cent of Vietnam’s total trade. Exports of goods from Vietnam to ASEAN in 2016 reached nearly $17.45 billion, down 4.4 per cent over 2015. Imports from ASEAN reached $24.04 billion, up 1 per cent. Vietnam has never recorded a trade surplus with the bloc since joining. In its first year, 1996, the deficit was $745 million, and last year stood at $6.59 billion. ASEAN was the largest trading partner of Vietnam in 1996 and 20 years later is the fourth largest partner, after the US, the EU, and China. Among ASEAN countries, Thailand is Vietnam’s largest trade partner, with turnover of $12.54 billion in 2016, followed by Malaysia with $8.51 billion, up 30-fold over the 20-year period.  Singapore was third, with trade in 2016 reaching $7.16 billion, accounting for 17.3 per cent of total trade between Vietnam and ASEAN. Bilateral trade with Indonesia in 2016 reached $5.61 billion, accounting for 13.5 per…... [read more]

Household appliances produced at LG Electronics Viet Nam’s plant in northern Hai Phong Province. Foreign-invested firms will be subjected to regular and sudden examinations. — VNA/VNS Photo Lam Khanh Firms operating in Viet Nam with foreign direct investment (FDI) will be subjected to regular and sudden examinations by appropriate Vietnamese authorities of their financial assets, according to the recently issued Decision 1381/QĐ-BTC by the Ministry of Finance (MoF). The decision regulates joint inspections of FDI businesses, regarding asset values of land and real estate, machinery and other tangible assets, as well as intangible corporate assets (i.e. licensing, lease, franchise agreements or employment contracts). This is considered a step up from the usual treatment of regulated annual examinations and notifications from Vietnamese authorities towards FDI firms. This is intended to expose and stop perceived malpractice by FDI firms, State agencies may conduct regular or sudden examinations and oversight of the implementation of FDI projects by foreign investors, covering the legal compliance of FDI enterprises, their commitments to the Vietnamese government, and the firms’ actual implementation and achievements. Decision 1381 states that annual examinations should take place in October, while the Agency of Corporate Finance under the MoF will join forces with the MoF’s Inspectorate to compose next year’s inspection plan, which will then be submitted to the MoF and the Ministry of Planning and Investment (MPI) before November 30 of the same year. Vietnamese authorities will now also be able to examine the…... [read more]

Although Vietnam’s business community has been the backbone of the country’s market-based economy over the past decades, it has experienced its share of ups and downs. Professor Nguyen Mai, chairman of the Vietnam Association of Foreign Invested Enterprises, provides a look back over the years, with an eye towards the future.  Vietnam’s 30-year transition from a concentrated and subsidised economy to a market-based one has resulted in remarkable changes in the development of the country’s enterprises. The economy used to rely on state-owned enterprises (SOEs) and agricultural and small-scale co-operatives. However, over the past three decades it has become characterised by the increasing development of private enterprises, whose numbers now come to over 620,000, including over 20,000 foreign-invested enterprises (FIEs). Many SOEs have been equitised, and the wholly-owned SOEs are almost all major ones. The resolution of the 12th Communist Party of Vietnam Central Committee’s (CPVCC) fifth plenary meeting stated, “Market factors and types of markets have been formed in a more synchronous manner, and they have become increasingly linked with the regional and global markets. Almost all goods and services have been traded under the market mechanism. The investment and business climate has improved more significantly; the right to freedom in doing business and equally competing among enterprises in economic sectors has been better ensured.” However, the resolution also underscored limitations: “The operational effectiveness of economic entities and types of enterprises in the…... [read more]

With no sharp increase in sight, and despite a reduced number of projects in recent years, the Vietnamese textile industry still attracts more than $750 million in FDI in the first six months of this year, mostly from investment capital increases in existing projects. RELATED CONTENTS: Indian companies to increase textile equipment exports to Vietnam Replace workers with machines: experts Garment sector export growth still unsustainable Five prosecuted for massive losses at state-run firm PM urges Vinatex reform Textile and clothing firms reluctant to implement Industry 4.0 practices Textile sector growth surges Textile and garment see resurgence of capital flows Major capital increases in existing projects After the two years considered the high point of FDI in the textile industry (2014-2015), since the start of 2016, the number of FDI projects in this industry has decreased considerably. In early 2017, Chinese investors invested $220 million in the Billion Vietnam polyester synthetic fibre plant in the southern province of Tay Ninh. Aside from this, however, capital flows consist mostly of capital expansion investments in existing projects. According to the Vietnam Textile and Apparel Association (Vitas), since the start of the year, the two projects with the largest investment capital increase in the textile industry were in the southern provinces of…... [read more]

The export value of farming, forestry and aquatic products gained a year-on-year increase of 14.7 per cent, to US$20.45 billion, in the first seven months of this year. — VNA/VNS Photo Dinh Hue The export value of farming, forestry and aquatic products gained a year-on-year increase of 14.7 per cent, to US$20.45 billion, in the first seven months of this year, according to the Ministry of Agriculture and Rural Development. Key farm produce raked in $10.89 billion, up 18 per cent while forestry products brought home $4.41 billion, up 10.8 per cent. The US, China and Japan were the three largest export markets of Viet Nam’s timber and timber products in the first half of this year, accounting for 70.2 per cent of total exports of those products. The markets with strong growth in timber export value included China (29 per cent), Canada (21.8 per cent), the US (18.7 per cent), Germany (10.6 per cent) and South Korea (9.2 per cent). Viet Nam shipped 3.3 million tonnes of rice, worth $1.5 billion, abroad, up 15.7 per cent in volume and 13.7 per cent in value compared to the January-July period of 2016. China was still the largest export market of Vietnamese rice during the first seven months, the ministry said. The second was the Philippines. Vietnamese businesses won contracts to supply 175,000 tonnes of rice to the Philippines at an open tender on July 25, according to the Viet Nam Food Association. …... [read more]

First of all, we can affirm that in 2006 Vietnam successfully made a breakthrough to gain momentum for further development.The 10th National Party Congress held at the end of April defined orientations for Party activity and key tasks for national development, namely to improve the Party’s leadership capacity and fighting spirit, promote the national comprehensive Renewal process and to lift Vietnam out of its underdeveloped country status. Afterwards, the 9th session of the 11th National Assembly (NA) adopted the five-year plan for socio-economic development (2006-2010) to successfully realise the Resolutions of the 10th Party Congress. The NA also elected the State President, the NA Chairman and the Prime Minister.The Party Congress’s realistic and creative views and guidelines and NA decisions were supported by the entire Party and people to win major achievements in 2006. Vietnam’s socio-economic situation in 2006 was prominently featured as follows: First, the economy obtained a rather high growth rate of 8.2 percent, exceeding the set target of 8 percent and the average growth rate of the previous five years. Second, the State budget, investment and international payment was kept balanced and stable to improve the macro economic environment. Third, progress was made in poverty reduction and employment activities. The rate of poor households based on the new poverty line dropped from 22 percent in 2005 to 19 percent in 2006, even beyond expectations. Fourth, external economic activities reached a record level. Newly registered and additional foreign direct investment (FDI) totaled US$10.2 billion with more than US$3.7…... [read more]

Last year’s total export turnover of agricultural products reached US$7.5 billion of which rice export turnover hit nearly US$1.3 billion, rubber (US$1.3 billion), coffee (US$80 million) and fruit and vegetables (US$260 million). Despite being one of Vietnam’s key export agricultural products, fruit and vegetable export turnover remains a pittance due to a low and unstable growth rate. The main cause is that the fruit and vegetable sector still lacks specific planning projects and concentrated cultivation areas, resulting in the failure to win big export contracts. While Thailand’s fruit and vegetable production scale is between 5-10 hectares per farmer household, Australia, 40-50 hectares per household, the figure in Vietnam stands at only 200-300 m2 for vegetable, 1,000 m2 for fruits per farmer household. Meanwhile, Vietnamese farmers fail to apply advanced technologies in the production to create high productivity and equal quality in order to meet the needs for high quality and hygiene safety of food required by foreign markets. To date, around 30 percent of districts throughout the country have no agricultural promotion centres and 19 percent of communes have no agricultural promotion staff, thus causing some difficulties for farmers to gain access to clean production.The world’s agricultural product export markets have now been put under strict control by supermarket systems run by multilateral companies. Due to consumers’ increasing knowledge, supermarkets’ requirements for high-quality agricultural products have become stricter and caused barriers for many developing countries which consider exports of agricultural products an impetus to stimulate economic development. Joining the WTO…... [read more]




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