Author: the-shiv
Black market US dollars sell for 550 dong higher than Vietnam official exchange rate
The SBV struggled to keep the dong from devaluing beyond 25,450 last week. Over the course of the week it issued US$1.2 billion in treasury bills to suck up liquidity and sold about US$520 million from its US dollar reserves, but still finished the week where it started. This latest development suggests that there might be more of the same this week…
Japan’s Toyota to focus on hybrids over electric vehicles in Vietnam market
Of note, Vietnam’s EV charging network is mostly owned by VinFast, a subsidiary of Vietnamese conglomerate Vingroup. The company claims to have more than 150,000 EV charging ports nationwide, however, these facilities are currently exclusively for Vinfast’s EV users. Vinfast has said that, after 10 years, the network will be opened up to other brands, however, this is years away and it’s not clear what electric car buyers of other brands will do until then…
Orders up but prices down for garments and textiles in Vietnam
Of note, last year was not a good year for garment manufacturers and clothing suppliers in Vietnam. This was mostly on the back of lower demand in key export markets as a result of higher inflation from higher fuel costs. The response to this has been mostly supply side stimulus. Tax and interest rate cuts have been common but the impact of these measures has been limited without the demand to support them. By the end of November 2023 exports of garments and textiles from Vietnam were hovering at US$30.4 billion, a drop of 12.3 percent over the same period in 2022…
S&P global maintains Vietnam BB+ long term, B short term ratings
S&P Global has maintained its ratings for Vietnam but notes there are some risks. Vietnam’s banking sector on its Banking Industry Country Risk Assessment matrix is rated 9. This is on a scale of one to 10 on which 1 represents the lowest risk and 10 represents the highest. This assessment “incorporates regulatory weaknesses, in addition to weak transparency and disclosure standards,” according to the report.
South Korean firm to exit Vietnam Vingroup, Masan holdings worth US$666 million
Both investments have lost considerable value since SK Group bought into these firms in 2018. Of note, SK Group bought 205.7 million shares in Vingroup–which trades under the ticker VIC–in 2019 for VND 113,000 or US$4.85 at the time for just shy of US$1 billion dollars. Vingroup shares last traded at VND 41,650 or US$1.64 valuing the firm’s current holding at US$337.4 million…
Electricity Vietnam reps meet Samsung leaders amid power supply concerns
The government has gone to great lengths to assure foreign investors that the supply will be adequate this year, however, moves to eek out support from foreign investors in reducing their power consumption seems to suggest otherwise–Just weeks ago, it was reported that Apple supplier Foxconn had been asked to curtail its power usages by 30 percent in anticipation of power shortages…
Vietnam think-tank finds 5.85 percent GDP growth more likely that 6.5 percent target
This is in line with the growth outlooks of Maybank Securities and the International Monetary Fund which both forecast GDP growth of 5.8 percent back in April. The Asian Development Bank, however, has been slightly more optimistic forecasting 6 percent and Singapore’s United Overseas Bank has been even more so, forecasting 6.4 percent growth for Vietnam this year…
Vietnam floats corporate income tax cuts for small-micro businesses
Of note, the draft amendments to the Law on Corporate Income Tax do not seem to make a distinction between local and foreign firms. That being the case, foreign-owned small businesses–cafes, bars, gyms, and what not–could also benefit from these changes if passed. That said, there does not seem to be a timeline for a decision as to whether these changes will be approved and go ahead…
Vietnam maintains position on US currency manipulator Monitoring List
Of note, the foreign currency criteria only addresses purchasing activity but not selling activity. Vietnam, however, has been dipping into its foreign currency reserves in order to stop the dong from devaluing since April… This speaks to Vietnam’s motives in the way it manages its currency, in that it does not necessarily appear to be trying to gain an unfair advantage in international trade even if its place on the Monitoring List might suggest otherwise…
Vietnam to consider nuclear power to meet net-zero commitments
Nuclear power in Vietnam has been floated before. In 2006, the government announce plans to have a nuclear power plant online by 2020 and this was followed a few years later by official plans for nuclear power plants in southern Vietnam in Ninh Thuan and Khanh Hoa provinces. These were, however, shelved in 2016 in favour of gas and coal on the back of lower demand projections…
Vincom Retail to add 6 new malls in Vietnam in 2024
Vincom Retail’s new malls align with a positive outlook for Vietnam retail space rentals. According to a CBRE market report released in May, in the first quarter of 2024, rental prices showed a steady increase per square meter, for ground/first floor spaces in non-CBD areas in Hanoi and Ho Chi Minh City, from US$30 and US$51 to US$30.6 and US$53.3, respectively…
China’s Chery to assemble electric vehicles in Vietnam
Vietnam’s electric vehicle market holds promise for foreign car manufacturers. Of note, electric car buyers are eligible for incentives such as exemption from registration fees for the first three years and a 50 percent fee reduction for the subsequent two years, per Decree 10/2022/NĐ-CP. Nevertheless, foreign car manufacturing firms may encounter challenges related to EV charging infrastructure and electricity supply shortages in Vietnam. These hurdles could potentially hamper manufacturers in expanding their market presence and sales…
Vietnam credit growth on the rise but still well below target
Of note, at the end of June last year, credit growth was sitting at about 4.73 percent. It also failed to climb much higher for most of the rest of the year until November when banks started to push consumer credit through aggressive marketing campaigns–credit growth jumped, as a result, from 7.41 percent at the end of October to 13.5 percent by the end of the year…
Vietnam could see net outflow of 300 high-networth individuals this year: report
Whereas the report says this is being driven by a search for greater opportunities, it should be noted that there are also push-factors driving migration abroad for wealthy Vietnamese. Prosecution of corrupt officials and business persons, whether legitimate or not, have become more common in the last couple of years. Wealthy Vietnamese that may be wealthy because they have acted in a not entirely above board way, could be looking for somewhere to flee should they find themselves in the crosshairs…
Real estate crowdfunding program halted not long after beginning in Vietnam
In the current economic climate, with deposit interest rates at historic lows, the local gold price much higher than the world gold price, and US dollars prices cresting all-time highs against the local currency, the need for a diversification of investment vehicles for Vietnamese consumers is becoming increasingly clear. Furthermore, Vietnam’s real estate market has been struggling to access capital on the back of a myriad of challenges the industry has faced in the past two years or so. In this context, this real estate crowdfunding program had a lot of potential…
Taiwanese ETF in Vietnam net-withdraws US$95 million from HoSE so far this year
This net selling momentum hasn’t been limited to Fubon. Foreign investors in general have been net sellers in the Vietnamese market, of late. From the beginning of 2024 until June 17, foreign investors hadhave net sold US$1.7 billion worth of Vietnamese securities listed on HoSE…
China’s Huawei considering Vietnam data centre but no commitment yet
Data centres in Vietnam are becoming more and more common. This is a result of a broader move to digitise the economy as well as several key regulations that require businesses to store the data of Vietnamese users in Vietnam. That said, there are a number of challenges for the sector, not least of which is Vietnam’s somewhat inconsistent electricity supply…
Top 10 life insurance firms in Vietnam dominated by foreign firms
Of note, Vietnam’s insurance sector has struggled over the last year or so with a number of high-profile instances of consumers claiming they were duped into purchasing insurance products.That said, it is slowly recovering with Vietnam Report’s survey results finding 45.5 percent of industry respondents expect the industry to grow by around 5 to 10 percent this year…
Key Apple supplier Foxconn to increase investment in Vietnam by US$52.6 million
Manufacturing in Vietnam, particularly in electronics, has been growing rapidly. Though notably there was a slight downturn last year, things have picked up again in 2024. Exports of computers, electrical products and parts thereof had reached US$5.5 billion by the end of May representing an increase of 31.6 percent over the same period a year earlier…
New Vietnam–Manila direct flights highlight growing south-south integration
This is welcome news for tourism in both countries. Of note, in the first five months of this year, Vietnam welcomed 85,936 tourists from the Philippines, an increase of 54.1 percent over the same period last year. This is in line with growing interregional travel which is visa free for members of ASEAN states. Filipino citizens, for example, can enter Vietnam visa free for up to three weeks. This latest announcement could signal a significant boost to these numbers…
In today’s Vietnam news: Dragon Capital Europe ETF, Carbon market opens, New regulations communicating with press , Copyright commercial-use fee confusion, Vingroup reduces holdings
In today’s Vietnam news: Ethical / cultural business standards framework, Floating solar project, Embattled construction firm investment spinoff, Raising public debt ceiling, Selling excess
In today’s Vietnam news: GS TL on AI, Saigon Economic Times last issue, Fuel prices cut, Vinhomes issuing more bonds, Counterfeit Korean cosmetics store,
This is an interview with Chris Walker, a Vietnam Sourcing Expert with Vietnam Factory Tours how rising oil prices and the Middle East crisis are
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