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Geopolitical news
Russian president Vladimir Putin was in Hanoi for two days
The Russian leader, Vladimir Putin, stopped by Russia’s old communist ally this week after a brief trip to North Korea. Putin met with a number of Vietnam’s senior leadership and signed a number of agreements on education, nuclear power, and cooperation on oil and gas. The decision to host the Russian leader was met with condemnation outside of Vietnam but that does not appear to have factored into local coverage of the event.
See also: The Impact of the Ukraine War on Vietnam’s Economy: Unpacked
Banking and Finance News
Vietnam credit growth on the rise but still well below target
Credit growth in Vietnam for the year had reached 3.79 percent by June 14 over the end of 2023, according to CafeF. This is a solid improvement over the start of the year when Vietnam recorded contractions in both January and February of 0.68 percent and 0.72 percent, respectively. It is, however, still well below the target of 15 percent for the year.
See also: Banking in Vietnam: Industry Overview 2024: Credit Growth Limits
State Bank open market operations as of COB June 20
The State Bank of Vietnam has continued to issue treasury bills to suck up excess liquidity in the economy. There are currently US$3.45 billion worth of T-bills outstanding as of the close of business on June 20. Also of note, the State Bank has outstanding loans to local banks to the tune of US$83.74 million.
Furthermore, the SBV also sold US dollars from its Forex reserves to the tune of US$780 million. This brings the bank’s total Forex spending since April to around US$4.9 billion based on ACB data.
Outstanding loans
| Issued | Length | Maturing | VND* | US$ | % p.a. |
| 14-Jun | 7 | 21-Jun | 2,132 | $83,743,049 | 4.50 |
*billions
Outstanding T-bills
| Issued | Buy/Sell | Length | Maturing | VND* | US$ | % p.a. |
| 27-May | Sell | 28 | 24-Jun | 200 | $7,857,000 | 4.20 |
| 29-May | Sell | 28 | 26-Jun | 5,150 | $202,317,750 | 4.25 |
| 30-May | Sell | 28 | 27-Jun | 4,900 | $192,496,500 | 4.25 |
| 31-May | Sell | 28 | 28-Jun | 16,250 | $638,381,250 | 4.25 |
| 3-Jun | Sell | 28 | 1-Jul | 8,450 | $331,958,250 | 4.25 |
| 28-May | Sell | 35 | 2-Jul | 3,700 | $145,354,500 | 4.20 |
| 4-Jun | Sell | 28 | 2-Jul | 6,150 | $241,602,750 | 4.25 |
| 5-Jun | Sell | 28 | 3-Jul | 3,160 | $124,140,600 | 4.25 |
| 5-Jun | Sell | 28 | 3-Jul | 5,800 | $227,853,000 | 4.25 |
| 5-Jun | Sell | 28 | 3-Jul | 4,900 | $192,496,500 | 4.25 |
| 10-Jun | Sell | 28 | 8-Jul | 2,100 | $82,498,500 | 4.25 |
| 11-Jun | Sell | 28 | 9-Jul | 1,300 | $51,070,500 | 4.25 |
| 12-Jun | Sell | 28 | 10-Jul | 600 | $23,571,000 | 4.25 |
| 13-Jun | Sell | 28 | 11-Jul | 2,650 | $104,105,250 | 4.25 |
| 14-Jun | Sell | 28 | 12-Jul | 700 | $27,499,500 | 4.25 |
| 17-Jun | Sell | 28 | 15-Jul | 2,650 | $104,105,250 | 4.25 |
| 18-Jun | Sell | 28 | 16-Jul | 5,150 | $202,317,750 | 4.25 |
| 19-Jun | Sell | 28 | 17-Jul | 6,450 | $253,388,250 | 4.25 |
| 20-Jun | Sell | 28 | 18-Jul | 7,550 | $296,601,750 | 4.25 |
| Total | 87,810 | 3,449,615,850 |
*billions
Gaming news
Two Vietnam gambling sites announce sponsorship deals with Premier League teams
Vietnam gambling sites NET88 and DEBET have inked deals with two English premier league clubs to sponsor their shirts next season. This suggests that, despite being illegal, gambling is still flourishing in the Southeast Asian nation.
For some perspective, sports marketing agency, Sports Quake, says that front of shirt sponsorship in the Premier League can cost from US$50 to US$70 million for the most well known teams and between US$5 and US$15 million for lower tier teams.
See also: Gambling in Vietnam: Foreign Investor Cheat Sheet 2024
Gold news
Vietnam banks sell gold online to relieve pressure on banks, demand surges
The four Vietnamese banks that are selling gold from the State Bank’s reserves have mostly moved to selling gold online. This is off the back of huge lines to buy gold over the past couple of weeks disrupting regular business at said banks.
This move, however, may have inadvertently facilitated a spike in demand giving people who don’t have the time to wait in queues at banks a more efficient means to buy the relatively cheap gold on offer. Of note, Agribank reported that at one point there were 50,000 attempts to register to buy gold at one time through its online portal.
See also: The Gold Price in Vietnam: Explained 2024
Human resources news
Vietnam PM suggests foreign workers for executive roles at state-owned enterprises
The Prime Minister of Vietnam, Pham Minh Chinh, has suggested state-owned enterprises should consider foreigners for executive positions. In order to do this, he has said that they should consider better remuneration packages and higher salaries.
In the past the leaders of SOEs have always been members of the Communist Party of Vietnam which has significantly reduced the talent pool from which to draw–there are currently only a little over 5 million members of the party or around 5 percent of the population.
That said, it is not clear how the establishment, more accustomed to political jostling and networking in order to get a hold of the more plum jobs, will take to a paradigm shift this radical.
See also: Average Salary in Vietnam 2024: Executive Salaries
Real estate news
Real estate crowdfunding halted not long after beginning in Vietnam
Hoang Hai, Vice Chairman of the State Securities Commission, said the commision has ordered a stop to a program whereby VPS Securities was selling shares for as little as VND 10,000 or US 39 cents in individual real estate projects. The Vice Chairman said “The Securities Commission has monitored this model and found that this is a quite risky form of investment,” according to CafeF.
Real estate crowdfunding has become popular all around the world in line with a broader democratisation of the finance industry. With this form of investing realised in most developed markets, it will be interesting to see what risks for Vietnam the SSC has identified.
See also: Vietnam’s Real Estate Market Recovery 2024: Unpacked
Stock market news
Vietnam cash, shares worth US$119.5 million to be liquidated in BlackRock ETF exit
US investment firm BlackRock has announced it will liquidate its iShares Frontier and Select EM ETF. About 29 percent of the fund is invested in Vietnamese stocks and cash both in the Hanoi Stock Exchange and the Ho Chi Minh City Stock Exchange. Those investments were worth about US$119.5 million as of June 10.
See also: Vietnam’s Foreign Investor Stock Sell-Off: Unpacked 2024
Foreign traders net withdraw US$178 million from HoSE
Foreign traders have continued to sell down their positions in the Ho Chi Minh City Stock Exchange. In total, just over US$178 million was withdrawn from the market over the last five trading sessions to the close of business on June 20. This brings the total net withdrawn from the market by foreign traders to US$1.82 billion so far this year.
Foreign trader activity, last five trading days
| Buy | Sell | Change | ||||
| Date | VND* | US$ | VND* | US$ | VND* | US$ |
| 14/6 | 1,976 | $77,627,160 | 2,548 | $100,098,180 | -572 | -$22,471,020 |
| 17/6 | 1,656 | $65,055,960 | 2,447 | $96,130,395 | -791 | -$31,074,435 |
| 18/6 | 1,427 | $56,059,695 | 2,081 | $81,752,085 | -654 | -$25,692,390 |
| 19/6 | 1,448 | $56,884,680 | 2,972 | $116,755,020 | -1,524 | -$59,870,340 |
| 20/6 | 1,657 | $65,095,245 | 2,648 | $104,026,680 | -991 | -$38,931,435 |
| Total | 8,164 | $320,722,740 | 12,696 | $498,762,360 | -4,532 | -$178,039,620 |
| *billions | ||||||
Source: www.hsx.vn
Tax news
Special consumption tax could increase to 100 percent on alcohol
Vietnam’s Minsitry of Finance has proposed increasing the special consumption tax–the SCT–on alcohol to 100 percent. For beer in Vietnam, it is currently set at 65 percent, and for spirits under 20° proof it is 35 percent and over 20° proof 65 percent.
Currently the price of a beer bought at a convenience store, including the current SCT, is around VND 15,000 or US$0.59 cents. For perspective, the average wage in Vietnam, as of the first quarter of this year, was VND 7.6 million, around US$304.61.
See also: Tax in Vietnam 2024: Quick Read
Vietnam considering 10 percent sugar tax on soft drinks
In the most recent draft of Vietnam’s Special Consumption Tax, the Ministry of Finance has included a ten percent tax on drinks with 5 grams or more of sugar per 100 millilitres.
The new sugar tax, if approved, would be added to Vietnam’s Special Consumption Tax legislation. This also covers alcohol and tobacco products making this law all the more important for new businesses entering Vietnam’s food and beverage sector to be aware of.
See also: How to Open a Bar in Vietnam 2024: Ultimate Guide
Trade news
Vietnam suspends priority customs treatment for Panasonic
The Dong Nai Department of Customs has issued a decision suspending preferential treatment for Japan’s Panasonic. The decision does not specify exactly what Panasonic failed to do, only citing Article 45 of the Customs Law.
Article 45 allows firms approved to receive priority customs treatment to submit incomplete documents when exporting or importing goods. These firms, however, must submit completed documentation within the following 30 days. A failure to do so can result in a suspension of priority service of up to 60 days.
See also: Priority Customs Treatment in Vietnam for Foreign Firms 2024
The week ahead
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