In case you missed it…
Why More Foreign Films Aren’t Made in Vietnam
Vietnam’s Ministry of Tourism, Sports, and Culture is headed to Hollywood to pitch Vietnam as a film set in the hopes that Vietnam’s appearance on the silver screen will boost tourist numbers. It will, however, likely take more than simply raising awareness to see more films made in Vietnam… Read More »
Aquaculture news
Aquaculture industry takes US$100 million hit from Typhoon Yagi
Typhoon Yagi, which tore across northern Vietnam earlier this month is estimated to have caused US$100 million worth of damage to Vietnam’s aquaculture industry, Vietnamnet has reported. Roughly 23,500 hectares of fish farms were reported damaged, with 4,592 fish cages and nets destroyed.
See also: Vietnam’s Aquaculture Industry: Overview
Banking and Finance News
Credit growth hovering at 7.26 percent
Credit growth in Vietnam was at 7.26 percent as of September 16, VN Express has reported. At the same time last year, credit growth had reached 5.73 percent. With a target of 15 percent for the year, this does seem to be an improvement, however, it’s not clear that all of the credit entering the Vietnam economy is good. Notably, bad debts are rising among Vietnam’s banks with one analysis of 29 of Vietnam’s biggest banks earlier this year, finding that 27 had recorded an increase in bad debt by the end of June. Between them, there was VND 46,719 billion or US$1.86 billion in bad debts, an increase of 20.8 percent compared to the end of 2023.
See also: Banking in Vietnam: Industry Overview 2024
Australian bank sells partial stake in Vietnam bank
The Commonwealth Bank of Australia–the CBA–has sold 5 percent of its holding in Vietnam International Bank–VIB–according to a press release. The stake was sold for A$160 million or US$109.7 million.
This comes after it was announced back in June that the Australian bank would be divesting from the company. Of note, VIB’s board of directors reportedly only learned about the divestment after the State Bank of Vietnam approved the move. The Commonwealth Bank held a 20 percent stake in the bank at the time.
VIB subsequently responded by announcing that it would be lowering its foreign ownership limit from 20.5 percent to 4.99 percent. This essentially means that the CBA can only offload its shares to Vietnamese buyers. It’s not clear what the thinking is behind this.
Of note, the overarching foreign ownership in banks is limited to 30 percent. Below this, foreign ownership limits are applied at the bank level and can be raised or lowered at will as long as they don’t exceed said 30 percent.
See also: Banking in Vietnam: Industry Overview 2024
State Bank open market operations pick up
The State Bank of Vietnam distributed just US$43.1 million in open market operations last week and didn’t issue any treasury bills. As a result, there was just US$360 million outstanding to local banks this time last week. This week, however, the situation appears to have changed considerably with reverse repos issued to the tune of US$1.95 billion over the last five working days.
See also: Vietnam Dong Tracker: Daily Updates.
Outstanding reverse repos to Vietnam banks
| Issued | Length | Maturing | VND* | US$ | % p.a. |
| 20-Sep | 7 | 27-Sep | 451.26 | $18,325,308 | 4.00 |
| 23-Sep | 7 | 30-Sep | 1,523.82 | $61,881,111 | 4.00 |
| 24-Sep | 7 | 1-Oct | 23,046.31 | $935,892,212 | 4.00 |
| 25-Sep | 7 | 2-Oct | 14,999.99 | $609,137,594 | 4.00 |
| 26-Sep | 7 | 3-Oct | 7,960.20 | $323,257,354 | 4.00 |
| Total | 47,981.58 | $1,948,493,579 |
*billions
Car news
Skoda assembly plant in northern Vietnam almost ready to go
A new assembly plant for the Czech Republic’s Skoda vehicles is set to go into operation later this year in northern Vietnam, The Investor is reporting. The plant in Quang Ninh province is 90 percent complete and began a trial run back in May. Set on 36.5 hectares the factory will add a capacity of 120,000 vehicles a year to Vietnam’s automotive industry.
Of note, it’s not clear all of those cars will be for domestic consumption which is only around 300,000 units a year. Notably, under the ASEAN Trade in Goods Agreement cars exported and imported within the bloc can do so tariff-free and, with this in mind, it may be that the bulk of these vehicles are shipped abroad.
See also: What’s Going On with Vietnam’s Car Market in 2024?
Economy news
ADB holds on Vietnam GDP forecast but ‘significant uncertainties on the horizon’
The Asian Development Bank has released its Asian Development Outlook report for September in which it keeps its growth forecast for Vietnam for this year at 6 percent. It also forecasts 6.2 percent for 2025.
The publication notes that there are ‘significant uncertainties on the horizon’ alongside several key observations:
- Rising non-performing loan risks limit further options for monetary easing.
- Structural weaknesses persist in the real economy.
- Vietnam’s exports face heightened competition from global value chain shifts and geopolitical tensions.
- The SBV’s capacity for accommodative policy is constrained.
- There is an urgent need for stronger fiscal support, faster public investment, and governance reforms.
See also: Vietnam Economy News
Education news
Vietnam’s richest man wants more English education in Vietnam
Pham Nhat Vuong, the chairman of Vietnam’s Vingroup conglomerate, including well-known (although not necessarily for the right reasons) electric car market VinFast, told a government-business conference last Saturday that English education in Vietnam needs to be expanded in order to foster a “global citizen society”, VN Express has reported.
English language proficiency has been a priority in Vietnam for some time, crystallised in 2008, with the Foreign Language Teaching and Learning in the National Education System in the 2008-2020 Period plan. This plan outlined a 10-year foreign language education program for all Vietnamese school students by 2020.
This target, however, was a tall ask, and in 2017, with this goal still well out of reach, the project was extended to 2025. This still seems unlikely and a further extension may be necessary. That said, this has partially contributed to the recent boom in English language learning centres, courses, and classes in Vietnam.
See also: How to Start an English Centre in Vietnam
Top Vietnam universities by revenue pull-in US$724 million in 2023
At least ten universities in Vietnam pulled in revenues of more than VND 2 trillion or US$40.8 million last year, according to analysis from VN Express. Of the ten universities, six were public and four were private. Of note, this list could still grow, with some universities still yet to report their revenues for 2023.
Of note, education and training contributed VND 181,111 billion or US$7.4 billion or 3.11 percent of GDP, according to Vietnam’s General Office of Statistics.
See also: Education in Vietnam: Industry Overview 2024
Food and beverage news
Cost of eating out in Vietnam rises .26 percent in July over August
The cost of eating out in Vietnam went up by .26 percent in August over July, according to the General Department of Statistics’ Consumer Price Index data. This was in line with a year-on-year increase in the cost of eating out of 3.72 percent.
That said, Vietnam recorded a fall in food and beverage outlets of 3.9 percent from the start of the year to the end of June, according to food and beverage point of sale technology provider iPOS. The bulk of this fall was in Ho Chi Minh City which recorded a contraction in the number of outlets of about 5.97 percent.
See also: Vietnam’s Food and Beverage Industry 2024
Manufacturing news
Vietnam launches strategy for semiconductor industry development
Vietnam’s Prime Minister has approved a semiconductor development strategy detailing targets and plans for the industry, which includes doubling semiconductor revenue between 2030 and 2040 from US$25 billion to US$50 billion, VietnamNet is reporting. It’s not clear how this goal will be realised with current media reports containing no specific policies only broad ‘areas of focus’.
Vietnam’s role in semiconductor supply chains is currently in assembly, testing, and packaging. Low-value work to be sure but it does give Vietnam a foot in the door. Whether it can leverage this to move its way up semiconductor supply chains remains to be seen.
Read more: Vietnam Semiconductor Manufacturing: Unpacked 2024
US$260 million Chinese circuit board factory slated for northern Vietnam
China’s Victory Giant Technology is building a US$260 million circuit board manufacturing facility in northern Vietnam’s Bac Ninh province, The Investor has reported. The facility is set to cover 10.36 hectares and produce 5,000 square metres of circuit boards a year when it is fully up and running which is estimated to be in 2026.
See also: Vietnam Electronics Manufacturing: Industry Overview 2024
Stock market news
Lack of bilingual reports ‘major barrier’ for foreign investors: HDCapital Exec.
HDCapital’s, General Director, Nguyen Thanh Long, has told a forum that just 10 percent of listed firms in Vietnam provide bilingual reports and that this is “a major barrier in accessing international investors”, according to reporting from Tuoi Tre. He also noted that just 60 percent of listed firms meet Vietnam stock market disclosure standards.
Of note, Vietnam is currently courting an upgrade from FTSE Russell and MSCI from a frontier market to a secondary emerging market and an emerging market, respectively. One issue raised has been disclosure standards.
Specifically, disclosures on the HoSE are often late, sometimes by months or even in some cases years. Vietnam Airlines’ audited financial statements for 2022, due in early 2023 were not made available until December of that year, for example.
That said, Nguyen notes that 60 percent is a marked improvement from 10 years ago when just 10 percent of firms met disclosure standards.
See also: Vietnam Securities Industry
Foreign traders net-sell US$42 million in HoSE shares
Over the last five trading sessions, to the close of business on September 12, in total, foreign investors net-sold US$42 million worth of stocks on the Ho Chi Minh City Stock Exchange. This reduces the total net withdrawn from the market by foreign traders this year to US$2.68 billion. Of note, a sizable portion of this can be attributed to the aforementioned CBA VIB sell-off.
See also: Vietnam’s Foreign Investor Stock Sell-Off: Unpacked 2024
Foreign trader activity, last five trading days
| Buy | Sell | Change | ||||
| Date | VND* | US$ | VND* | US$ | VND* | US$ |
| 20/9 | 2,934 | $119,147,393 | 3,238 | $131,492,590 | -304 | -$12,345,197 |
| 23/9 | 1,451 | $58,923,949 | 1,235 | $50,152,362 | 216 | $8,771,587 |
| 24/9 | 1,447 | $58,761,512 | 3,878 | $157,482,478 | -2,431 | -$98,720,965 |
| 25/9 | 2,334 | $94,781,873 | 1,808 | $73,421,434 | 526 | $21,360,439 |
| 26/9 | 2,566 | $104,203,207 | 1,607 | $65,258,984 | 959 | $38,944,223 |
| Total | 10,732 | $435,817,934 | 11,766 | $477,807,847 | -1,034 | -$41,989,913 |
*billions
Source: www.hsx.vn
Trade news
Indonesia officially applies to join Vietnam, others in CPTPP
Indonesia has officially applied to join the Comprehensive and Progressive Trans-Pacific Partnership agreement, The Diplomat has reported. The next step will be for New Zealand, as the depository of the agreement, to officially acknowledge receipt of the request. It will then move to the CPTPP commission which will decide whether or not to commence accession procedures.
Of note, the Indonesian and Vietnamese economies are relatively similar. They are both export-oriented and have developed quickly by providing abundant low-cost labour to the global manufacturing industry. As such, the two countries often compete for foreign direct investment projects. In this context, Indonesia’s accession to the agreement could chip away at Vietnam’s edge over its neighbour to the south.
See also: List of Vietnam’s Tree Trade Agreements
Cosmetics imports up 11.2 percent August over July
Vietnam’s cosmetics imports of essential oils and resinoids, perfumes, cosmetics, and toilet preparations climbed by 11.2 percent in August over July from US$119.7 million to US$133.1 million. Vietnam’s cosmetics imports for the year now stand at US$932 million which represents an increase of 16.7 percent over the same period last year.
See also: Vietnam’s Cosmetics Industry
Garment and textile exports up 9.1 percent in value August over July
Vietnam’s garment and textile exports climbed by 9.1 percent in August over July from US$3.7 billion to US$4.1 billion. Vietnam’s garment and textile exports for the year now stand at US$24.4 billion which represents an increase of 8.1 percent over the same period last year.
See also: Vietnam Garment Manufacturing 2024: Quick Guide
Non-wood furniture exports up 6.31 percent August over July
Vietnam’s non-wood furniture exports increased by 6.31 percent in August over July from US$261 million to US$279 million. This has brought Vietnam’s total non-wood furniture exports to a total US$2.12 billion year-to-date. This represented an increase of 31.7 percent over the same period last year.
See also: Vietnam Furniture Manufacturing: Industry Overview 2024
Dairy imports up 7.23 percent August over July
Vietnam’s imports of milk and milk products by 7.23 percent in August over July from US$101.5 million to US$108.9 million. Vietnam’s milk and milk products imports for the year now stand at US$744.4 million which represents a decline of 6.9 percent over the same period last year.
See also: Vietnam’s Dairy Market 2024: Overview
The week ahead
There are a handful of events coming up this week. For more information see the: Doing Business in Vietnam: Events Directory 2024
Also, Vietnam is a dynamic market that is changing rapidly. To keep updated to date with the business environment and how it is evolving make sure to subscribe to the-shiv.