Vietnam news in English for foreign firms doing business in Vietnam

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Vietnam’s Vinfast delays North Carolina factory, status of tax incentives unknown

the-shiv July 13, 2024

Of note, Vinfast was given a number of tax breaks and incentives by the North Carolina government to encourage its investment in the state. These amounted to a combined US$1.25 billion understanding that the firm would create 7,500 jobs and invest US$4 billion in its factory. This included US$325 million in funds provided up front for site preparation and the upgrade of infrastructure to service the plant, as well as training programs, with the rest tied to key milestones in construction and hiring. It’s not clear what will happen to these incentives in the context of the three year delay that has just been announced…

Finland’s PYN Elite fund names embattled Vietnam Airlines stock pick of the month

the-shiv July 13, 2024

The fund doesn’t really give any clear reasons for making this call but does note that the government gave the airline an extension on a US$160 million loan. It should be noted, however, that this was to avoid insolvency with the airline currently operating on negative equity. It also should have been delisted from the HoSE years ago, however, the government intervened to stop that from becoming a reality. In light of this, naming Vietnam Airlines as the stock of the month is an interesting decision to say the least…

Vietnam’s biggest insurance firms to reduce state ownership

the-shiv July 12, 2024

Notably, state-owned insurers held a dominant position in Vietnam’s insurance market share in 2023, with Bao Viet leading at 15.13 percent. That said, the Vietnamese insurance market is opening its doors to foreign investment. In 2022, a new Law on Insurance Businesses was passed that allows for foreign firms to wholly own Vietnamese insurance companies…

China textile firm kicks off construction of US$71 million factory in northern Vietnam

the-shiv July 12, 2024

Notably, Vietnam’s textile and garment industry experienced strong growth in the first six months of 2024. In the first half of 2024, Vietnam’s textile and garment exports reached approximately US$16.5 billion, an increase of 4.6 percent over the same period in 2023. However, the improvement in Vietnam’s textile and garment exports does not seem to necessarily stem from improved global demand but from a shift of orders from other countries to Vietnam…

Japan noodle firm to invest US$87 million in northern Vietnam in 2027

the-shiv July 12, 2024

Notably, Vietnam was among the top three markets for instant noodles globally over the three years ending in 2022, according to the World Instant Noodle Association. Vietnamese consumed approximately 8.48 billion packs of instant noodles in 2022 collectively or 85 packs per person…

Vietnam News Roundup: July 5 to July 11

Mark Barnes July 12, 2024

This week’s Vietnam news roundup covers Vietnam’s latest import and export numbers, bond issuances, new manufacturing projects, IPO data, foreign trader stock market activity, electricity news, and more…

Vietnam state power provider records 2023 loss of more than US$1 billion

the-shiv July 11, 2024

Of note, retail electricity prices in Vietnam are regulated and, though permitted, price rises are not all that common. This has led to EVN selling electricity below cost price. As of January, it was losing about VND 142.5 per kilowatt-hour sold. This has been ongoing for some time and has led to EVN accumulating the huge aforementioned losses. The issue here seems to be a reluctance to raise electricity prices rather than an inability to do so…

Vietnam records just one IPO in first half 2024, tied lowest among SEA peers

the-shiv July 11, 2024

That single IPO was Hanoi-based DNSE Securities which officially listed under the ticker DSE on the Ho Chi Minh Stock Exchange at the start of July. Notably, this was the first new listing of a securities firm on the local bourse in the last five years…

South Korea to develop resource recycling industrial park in Vietnam

the-shiv July 10, 2024

Of note, despite the staggering volume of waste generated in Vietnam, waste treatment in the country remains ineffective. Currently, 70 percent of trash is buried, around 10 percent recycled and the rest, processed in other ways. According to the National Environmental Status Report in 2021, the majority of waste is taken to landfill sites, with only 20 percent meeting national sanitary requirements…

What’s Happened to Vietnam’s Beer Market? Unpacked 2024

Mark Barnes July 10, 2024

The closure of the Heineken plant in Quang Nam, in central Vietnam, announced a week or two ago, has been big news. This is off the back of slow growth in beer sales post-pandemic and in line with falling revenues among a number of Vietnam’s major beer brewers. This has been blamed on broader economic challenges and harsher drink driving penalties, however, it is all a little more nuanced than that…

Malaysian hardware retailer expands foothold in Vietnam

the-shiv July 10, 2024

This is in line with a rapidly growing DIY and home hardware industry in Vietnam–in 2024, revenue in the industry in Vietnam is expected to reach US$18.91 billion and will grow at an estimated compound annual growth rate of 3.13 percent from 2024 to 2028, according to data compiled by Statista…

Amkor to push up investment in northern Vietnam by 11 years

the-shiv July 10, 2024

This will make the province one of Amkor’s most extensive facilities in the world with total funding for the project reaching $1.6 billion–a $520-million factory in the first phase was inaugurated in October 2023 and is in line with a number of other big names investing in Bac Ninh including Samsung, Fushan, Canon, and Foxconn. Of note, Bac Ninh was the second most popular province for foreign invested projects in the first quarter 2024…

Singapore battery maker increases Vietnam investment by US$5.5 million

the-shiv July 10, 2024

The move to expand battery production capacity aligns with increasing global demand for electric vehicles–or EVs for short. The world is witnessing an explosion of EVs, with electric car sales in 2023 six times higher than in 2018, just 5 years earlier. Furthermore, global EV sales are predicted to grow from less than 45 million in 2023 to 250 million in 2030 and reach 525 million in 2035, according to the latest research by IEA…

Vietnam bank bond issuances skyrocket in June

the-shiv July 9, 2024

Of note, deposit interest rates have been rising alongside loans issued by the State Bank of Vietnam to local banks through open market operations–there are currently VND 22,765 billion or US$895.5 million worth of these loans outstanding. It’s also worth noting that credit growth jumped significantly in June reaching 4.45 percent by the 24th. This was significant in that at the end of May credit growth was just 2.41 percent…

New airport slated for central Vietnam’s Quang Tri starts construction

the-shiv July 9, 2024

Vietnam’s airports have been a critical component in logistics in Vietnam and subsequently in Vietnam’s economic development. They are the main entry point for most foreign investors, they facilitate millions of dollars of trade via air freight every day, and they have commanded huge amounts of public investment spurring the country’s economic growth. With this in mind, the new airport in Quang Tri should position the province well for future economic growth…

Vietnam opens thousands more trading accounts in June despite risks

the-shiv July 9, 2024

An additional 106,417 stock trading accounts were opened in Vietnam in June, according to data from the Vietnam Securities Depository and Clearing Corporation. Of those, individual foreign investors accounted for 159 individual accounts with 27 for foreign organisations. The total number of active trading accounts in Vietnam is now 8,044,825, but this number is a little misleading…

Vietnam paper plates unfairly subsidised 237.65 percent: US Department of Commerce

the-shiv July 8, 2024

Five of the six firms investigated were found to be subsidised to the tune of 237.65 percent. Notably, four of these firms failed to respond to the DOC’s request for information at all, and one failed to provide all of the information requested. The sixth, Go-Pak Paper Products Vietnam, the only company to sufficiently engage with the DOC, was found to be subsidised by just 5.48 percent…

Vietnam corporate bond issuances jump in June

the-shiv July 8, 2024

Of note, bond market reforms issued at the end of 2022 resulted in the bond market freezing up with issuances reduced to a trickle. These reforms were then put on hold in March of 2023 and the bond market bounced back. They did, however, come to an end at the end of last year and this looks to be reflected in bond issuances in the first six months of the year which have been lacklustre at best– at least they were until June…

LG factory complex in Hai Phong set to be completed in 2025

the-shiv July 8, 2024

Of note, in 2013, Trang Due Industrial Park, where the complex is located, gained official approval from the Prime Minister to become part of the Dinh Vu-Cat Hai Economic Zone giving the park access to government incentives only offered to approved Economic Zones. For example, firms in the past have been eligible to pay no taxes for the first four years, and a ten percent tax rate for the following 15 years. That said, in response to the OECD’s Global Minimum Tax initiative, Vietnam’s National Assembly passed Resolution 107 late last year, which will see multinational companies paying less than 15 percent tax, required to make up the difference via a top up the tax mechanism…

First new securities firm in five years debuts on Vietnam bourse, shares fall

the-shiv July 8, 2024

Contrary to the trend of foreign investors net selling billions of dollars from HoSE in 2024, foreign investors have been net buyers of DSE shares. Notably, Consilium Investment Management from the USA net bought more than US$ 6.6 million shares on July 2, accounting for more than 2 percent of DNSE’s value. Earlier in January, Finland’s Pyn Elite Fund also invested in DNSE buying 12 percent of the firm’s equity. As of July 5, foreign investors held 13 percent of DNSE’s shares–as a securities firm there is no foreign ownership limit…