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Tag: asia

  • EU considers loosening controls on Vietnamese noodles

    EU considers loosening controls on Vietnamese noodles

    According to the Vietnam Trade Office in Belgium, the European Union (EU) is considering a proposal to reduce food safety control measures on instant noodles imported from Vietnam.

    Since February last year, 20% of Vietnamese instant noodle shipments exported to the EU have been subject ethylene oxide level inspections. All shipments have been required to come with health certificates issued by Vietnamese regulatory agencies.

    According to the Vietnamese Ministry of Industry and Trade, in the second half of 2022, the EU found no ethylene oxide, an organic compound with various applications (including disinfection and sterilization), in Vietnamese instant noodles.

    Therefore, the EU has proposed not requiring health certificates for instant noodles imported from Vietnam, reported the office.

    According to the office, the proposal is expected to be approved by the block’s member states at a meeting in April.

    By the end of February, the Ministry of Industry and Trade had issued 3,170 health certificates to exporters of instant noodles to the EU market through 21 ports.

    Germany is the largest import of instant noodles from Vietnam, accounting for over half of the certificates issued.

    In August 2021, a number of batches of Vietnamese instant noodles exported to the EU market were returned or destroyed due to residues of ethylene oxide exceeding the permissible level stipulated by the EU.

    Currently, each country and region has different regulations on ethylene oxide.

    Ethylene oxide is commonly used as a highly effective disinfectant and fumigation agent in a number of agricultural products, especially spices and herbs.

    Consumption of products containing ethylene oxide does not pose an acute health hazard but can cause cancer if taken regularly for a long time.

    In many European countries, 2-chloroethanol, a metabolite of ethylene oxide, is considered ethylene oxide when they calculate the ethylene oxide content in foods.

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  • Durian prices plunge by half

    Durian prices plunge by half

    Durian prices have plunged by half in nearly two months as harvest season approaches and supply is abundant.

    Farmers in the southern provinces of Tien Giang, Long An, Binh Phuoc, and Dong Thap sell their Ri6 durian for VND75,000-VND85,000 per kilogram ($3.19-$3.62), down from VND190,000 in earlier February.

    Lanh, a farmer in Tien Giang, said he sold seven tons of durian for VND75,000.

    “I sold quickly due to a fear of a steeper plunge,” Lanh said.

    In Can Tho City, Hanh is selling the lower quality durian for VND45,000 per kilogram, down by half from last month.

    Prices are set to fall further as harvest season in Binh Phuoc and Dong Nai provinces approaches, she added.

    Van Hoa Investment and Development, which buys durian from farmers for export, is offering VND95,000 per kilogram for the highest quality and VND75,000 for the medium segment. The company buys 20-30 tons a day from suppliers.

    Traders say that the increase in supply as the harvest season approaches has pulled down durian prices. Furthermore, other fruits, such as rambutan and plums, will be harvested soon, which will make durian less attractive.

    Prices could fall even further in May when durian farms in the central highlands begin to harvest.

    Vietnamese durian will also have to face competition in the summer with durian from Thailand and the Philippines.

    Vietnam’s durian farming area reached 110,000 hectares by the end of last year after the country was allowed to export the fruit officially to China. This exceeded the government’s plan by nearly 47%.

    In the first two months this year some farmers in the southern and central highlands regions even chopped down coffee, pepper and rice to grow durian as prices surged.

    China is also growing its own durian to meet domestic needs. The country has 93.3 hectares of the fruit on Hainan Island.

    The Laos government has agreed to set aside 30,000 hectares of agriculture land to grow durian specifically for the Chinese market. This is equivalent to around 27% of Vietnam’s durian farming area.

    The Philippines, which earlier this year received permits from China for fresh durian exports, plans to send 54,000 tons of the fruit to the market of 1.4 billion people this year.

    The Vietnamese Ministry of Agriculture and Rural Development has advised farmers to stop switching en masse to durian farming to prevent an oversupply.

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  • Expats unhappy with Vietnam visa policy

    Expats unhappy with Vietnam visa policy

    Vietnam’s consternating visa policies helped placed the nation in the bottom 10 of an index ranking countries in terms of how favorable expatriates find their living conditions.

    The Expat Essentials Index, informed by the annual Expat Insider survey by website InterNations (which describes itself as the world’s largest online community of expats), found expatriates vexed about the Vietnam’s visa policy.

    For the 2022 edition of the index, InterNations asked 11,970 expats of 177 nationalities living in 181 countries and territories to provide information on various aspects of expat life.

    To be featured in the Expat Essentials Index, each destination needed a sample size of at least 50 survey participants. In total, 52 countries and territories met this requirement.

    Vietnam landed in the bottom 10, ranking 46th in the overall index, which included the four subcategories of Digital Life, Admin Topics, Housing, and Language.

    The nation was placed 51st out of 52 destinations for the Admin Topics Subcategory.

    Within this subcategory, 48% of surveyed expats reported that they had difficulties obtaining a visa to move to Vietnam, double the global average of 24%.

    Almost two in three, or 66%, said it was challenging to deal with the local bureaucracy, compared to 39% globally. And 41% found it difficult to open a local bank account, compared to 21% globally.

    “The bureaucracy makes simple tasks quite difficult,” said a British expat living in Vietnam, according to the survey.

    Vietnam ranked last for the availability of government services online in the Digital Life Subcategory, where it placed 49th. About one in four expats (23%) described it as difficult to pay without cash in Vietnam, compared to 8% globally.

    The country also fell in the bottom 10 of the Language Subcategory, ranking 47th.

    Within this subcategory, Vietnam ranked last for the ease of learning the local language.

    However, 65% of respondents reported that it is easy to live in Vietnam without speaking the local language, compared to 51% globally.

    For more positives, the country excelled in the Housing Subcategory, where it ranked fifth. Nearly seven in 10 expats (69%) considered housing in Vietnam affordable (compared to 39% globally), and 76% reported that it is easy to find a house here (versus 54% globally).

    The survey found Bahrain the world’s best destination for expats and Germany the worst. Singapore came third in the list as expats highly rated its digitalized life and Indonesia sixth thanks to affordable housing, with both having the language advantage.

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  • Vietnamese universities among top 100 in subject ranking

    Vietnamese universities among top 100 in subject ranking

    Quacquarelli Symonds (QS) has ranked two Vietnamese universities as among the world’s top 100 in their subject areas.

    In Hospitality and Leisure Management, Duy Tan University in Da Nang was ranked 51 out of 100 in the QS World University Rankings by Subject 2023.

    In the Engineering Petroleum program, Vietnam National University Ho Chi Minh CITY (VNU-HCMC) in the eponymous city also placed 51 out of 100, according to the rankings announced on Wednesday.

    VNU-HCMC’s Engineering-Petroleum program held the same rank last year, while this is Duy Tan University’s Hospitality and Leisure Management program’s first time on the list.

    Vietnam is also home to two other universities that ranked within the top 300 in certain subject areas.

    Duy Tan University also made it to 201 out of 230 in the Engineering-Civil and Structural Engineering subject, while Ton Duc Thang University in HCMC made it to 251 out of 300 in Mathematics.

    Vietnamese universities made the rankings in three other subjects. In Engineering and Technology, Duy Tan University was ranked 326, Hanoi University of Science and Technology and VNU-HCM both at rank 401 out of 450, and the Vietnam National University in Hanoi at rank 451 out of 500. In Natural Sciences, Duy Tan University and Vietnam National University in Hanoi were both at rank 451 out of 500. In Social Sciences and Management, Duy Tan University was at rank 451 out of 500 and VNU-HCM at rank 501 out of 530.

    Quacquarelli Symonds (QS) is a British firm specializing in overseas education. This year’s ranking includes around 1,600 global universities in 54 subjects, based on criteria like academic reputation, citations per paper and international research networks.

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  • OTT services like Telegram, WhatsApp must be managed locally

    OTT services like Telegram, WhatsApp must be managed locally

    Over-the-top media services, including popular messaging apps like Telegram, need to be managed under the Law on Telecommunications, according to amendments to it proposed by the government.

    The Ministry of Information and Communications said OTT services could be considered direct substitutes for traditional communications like calling and texting, and popular apps like Zalo, Viber, Telegram, and WhatsApp come under this category.

    “There are currently no provisions in the law for managing them, and so there is no way to protect users and information safety and security.”

    The ministry also called for a level playing field for domestic and foreign businesses. Specifically, for OTT telecom services that collect fees, domestic providers need to be approved to do so, while international providers need to have commercial agreements with an approved domestic provider to do so, it proposed.

    Even for OTT telecom services that do not have fees, the ministry proposed that their providers still need to register with the information ministry. International, large-scale providers with service in Vietnam meanwhile must either have commercial agreements or place their representative offices in Vietnam to make sure they abide by local law.

    At a conference held Thursday to discuss the amendments, Vu Tu Thanh of the U.S.-ASEAN Business Council said OTT service providers have no connection with telecom providers.

    “For instance requiring Viber to sign an agreement with VNPT … We don’t know exactly what terms such an agreement would have,” Thanh said.

    Officials proposing the amendments yet said managing OTT services will ensure users’ protection and information security.

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  • Vietnam to block payment for unlicensed games

    Vietnam to block payment for unlicensed games

    The Ministry of Information and Communications said it will deploy solutions to block the payment for unauthorized games in the country.

    There are hundreds of thousands of unauthorized games, card games, and gambling games which cause insecurity and disorder as well as bad consequences for the society, the ministry’s Authority of Broadcasting and Electronic Information said at a meeting on Thursday.

    The unauthorized games, mainly released on the App Store, Google Play, and online gaming platform Valse Stream, are estimated to generate an annual revenue of nearly VND5 trillion ($211.86 million), accounting for 30% of the total revenue of the game industry in Vietnam.

    The ministry is requiring organizations and businesses that provide intermediary payment services not to allow payment for unauthorized games through their systems.

    In the case of payments via IAP (in-app purchases), they should ask Apple and Google to provide sufficient information about the transaction to block the payment.

    Every month, the Authority of Broadcasting and Electronic Information will update the list of licensed and unlicensed games for payment intermediaries.

    The ministry also said it will require Google and Apple not to cooperate with intermediaries to pay for unauthorized games on their app stores.

    According to Le Quang Tu Do, the authority’s director, many games are being released across borders through the App Store and Play Store, while a number of Vietnamese e-wallets have been deployed on the two stores, making it easy for users to pay through intermediaries.

    The Ministry of Information and Communications has so far licensed some 200 game companies, but the number of licensed businesses that are actually providing games to the market is less than 30.

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  • Vietnam to raise air ticket price cap

    Vietnam to raise air ticket price cap

    The Ministry of Transport will increase the domestic air ticket price ceiling in Vietnam by an average of 3.75% later this year, a decision to delight local carriers.

    The maximum airfare on four out of five flight distances will rise in the second or third quarter, according to a recent Ministry of Finance price report.

    The biggest increase will be 6.67% (to VND4 million or $170) for one-way tickets on flights of 1,280 kilometers (Hanoi to Phu Quoc Island) and longer.

    Flights between 1,000 and 1,280 kilometers will see their ticket cap price rise 6.25% to VND3.4 million.

    Flights of smaller distances will see their maximum price rise by between 2.27% and 3.58%.

    Flights under 500 kilometers will see no ceiling change. Their prices will remain at a maximum of VND1.7 million per one-way ticket.

    The cap price increase will likely increase Vietnam’s 2023 Consumer Price Index by 0.07% points.

    Earlier this year, Vietnam Airlines and Bamboo Airways proposed increasing the cap ticket price to take into account rising in costs.

    The airfare price cap was last increased in 2015.

    By November last year, fuel costs had surged more than 80% from September 2015, which raised airlines’ total expenses by 33.5%, according to the Civil Aviation Authority of Vietnam (CAAV).

    Bamboo Airways CEO Nguyen Manh Quan has argued that the price cap be applied only to air routes operated by a single carrier.

    For routes with two carriers or more, the cap should be removed so the “market can adjust by itself,” he said.

    Some analysts have said that the price cap is unreasonable and could slow the growth of domestic aviation.

    In 2021, the CAAV proposed that air routes with three carriers or more have no price cap to allow for more healthy competition in services.

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  • VinFast rolls out long-awaited electric SUVs, eyes overseas deliveries

    VinFast rolls out long-awaited electric SUVs, eyes overseas deliveries

    Vietnamese carmaker VinFast said on Thursday it will begin delivering its new electric sport utility vehicles (SUVs) to local customers this week and targets overseas deliveries in the coming months.

    VinFast, which began operations in 2019, is gearing up to expand in the United States, where it hopes to compete with legacy automakers with its two electric SUV models.

    “After Vietnam, VinFast expects to export the first batch of VF9 to international markets in the coming months,” VinFast said in a statement, without providing a specific timeline for deliveries of the new model.

    The VF9 model was initially scheduled to debut at the beginning of this year.

    The company currently sells the VF8 model of SUV. It started shipping those last year and delivering them to customers this month. The company has said it would ship the second batch to the U.S. in the second quarter of 2023.

    VinFast, backed by Vietnam’s biggest of conglomerate Vingroup JSC, is the country’s sole EV maker.

    As of December last year, VinFast said it secured 55,000 orders globally, of which 12,000 were from the U.S. market.

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  • Bamboo Airways to raise $425M through rights issue

    Bamboo Airways to raise $425M through rights issue

    Bamboo Airways plans to make a rights issue of shares to increase its capital by 54%, or nearly VND10 trillion (US$425.44 million), to fund operations and pay off debts.

    It will offer 35 new shares for every 100 held and the issuance will be made this year.

    It currently has a charter capital of VND18.5 trillion.

    The proposal will be presented to shareholders at an extraordinary general meeting on Apr. 10.

    The airline has said it has found a buyer to take it over.

    Former chairman Trinh Van Quyet, arrested last year for alleged stock manipulation, owns a 55.5% stake in it.

    The buyer, whose identity has not been revealed, has agreed to take over the entire debts and provide Quyet with the money he might have to pay as fines and indemnification for the stock manipulation that led to his arrest.

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  • Moody’s lowers Techcombank ratings

    Moody’s lowers Techcombank ratings

    Ratings agency Moody’s Investors Service has downgraded the long-term deposit and issuer ratings of private lender Techcombank because of its high exposure to the struggling property sector.

    Its currency deposit and issuer ratings were lowered from Ba2 to Ba3, the same level as several other banks in Vietnam.

    Its outlook is down from stable to negative.

    “The downgrade of Techcombank’s ratings and assessments reflects Moody’s expectations that the stress faced by Vietnam’s real estate sector will negatively impact the bank’s standalone credit strength, given its high exposure to the sector,” the ratings agency said in a release.

    It claimed that the downgrade is unrelated to recent U.S. bank failures and events at Credit Suisse Group AG.

    As of the end of December loans to the property and construction sectors represented 29% of Techcombank’s gross loans.

    The bank also had exposure to the sectors in the form of corporate bonds, which made up 6% of its total assets.

    Some of its exposure to the property sector were of significant size relative to its tangible common equity and could bring volatility to its profitability and capital should they become problem assets.

    Defaults by real estate companies in Vietnam have increased since 2022 because of tighter regulations for bond issuances alongside arrests of high-profile real estate business owners and executives amid the government’s anti-graft crackdown.

    Property sales have also weakened because rising interest rates have hit affordability.

    These factors have weakened the debt repayment capacity of property developers, particularly highly leveraged ones with a sizable amount of bonds maturing in 2023 and 2024.

    Techcombank’s asset quality could therefore deteriorate given its exposure to the sector.

    Its funding and liquidity are adequate given the current environment but are vulnerable to confidence shocks like at other Vietnamese banks.

    The negative outlook reflects uncertainties around how the real estate sector in Vietnam will perform and, in turn, the risk of a further strain in the bank’s standalone credit strength if stress in the real estate sector persists.

    Moody’s could change the outlook to stable if the stress abates or the bank maintains its problem asset ratio, including its restructured assets, at less than 2% over the next 12–18 months while gradually reducing concentration to the real estate sector.

    A bank spokesperson said Moody’s decision reflects the challenges the banking industry faces.

    But Techcombank’s core strengths would allow it to remain outstanding, especially in terms of the strength of its capital base, liquidity position and earnings-to-operating income ratio, the spokesperson added.

    An earlier Moody’s report said many lenders in Vietnam had high exposure to the property and construction sector as of 2021, the top five being Viet Capital, Nam A Bank, SHB, Techcombank, and BIDV.

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  • Vietnam rice price on top of the world

    Vietnam rice price on top of the world

    Vietnamese 5% broken rice has been the most expensive in the world since August last year, surpassing rivals Thailand and India, according to the Ministry of Industry and Trade.

    In the first two months of this year Vietnam’s average rice price was over $519 per ton. Since August last year, it has exceeded Thai prices by $15-27 and prices from India by $40-50.

    Although Vietnamese export volumes dropped 20.9% year-on-year to $400,000 tons in January, prices rose 7%.

    Last year rice exports from Vietnam reached a 10-year high of 7.1 million tons.

    The country plans to export 6.6 million tons of rice this year, with 4.12 million tons in total scheduled to be delivered by the end of the first six months.

    Favorable export conditions are expected to return this year thanks to a resumption in demand from Indonesia and Bangladesh.

    Buyers will increasingly turn to Vietnam for rice as India has banned the export of broken rice and put a 20% tax on white rice.

    But the Ministry of Industry and Trade is concerned that the need for more diversification in export markets and dependence on China and the Philippines (the latter being the largest buyer of Vietnamese rice, accounting for 45% of exports) will be a challenge to the industry.

    Low-priced rice from Pakistan may also present a challenge to holding market shares.

    Input prices have been rising and logistics costs have remained high since the beginning of the Russia-Ukraine conflict.

    The trade ministry is working with the E.U. to better introduce the import of Vietnam fragrant rice on the continent.

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  • Steel prices surge in face of declining demand

    Steel prices surge in face of declining demand

    Vietnam’s major manufacturers have raised steel prices to a 7-month high despite plunging demand.

    On Tuesday, Hoa Phat Group hiked its prices for rebar steel by 0.95% to VND15.99 million ($678.55) per ton.

    Local steelmakers Viet Y, Viet Duc, Kyoei and Viet My all made similar adjustments, while Pomina’s price tag towered above at VND17.6 million, 10% higher than market average.

    Manufacturers said that steel prices, which are now at their highest point since August, have been rising since October last year due to an input materials shortage prompted by declining billet production.

    Steel billets are raw steel bars not yet processed for the market, and billet makers reduced production due to low prices in earlier months.

    Steel demand will likely remain meager in upcoming months.

    Steel products sales in the first two months of 2023 plunged 23% year-on-year to 3.8 million tons, while exports dropped 10% to 1 million tons.

    Analysts at brokerage Mirae Asset Vietnam said that the steel market is largely dependent on the property sector, and the real estate market cool down this year has thus adversely affected the steel industry.

    Steel production is therefore expected to drop 10.5% from last year to under $17.9 million tons this year.

    However, manufacturers hope that public spending, which is set to hit an historic high of VND704 trillion this year, will help boost demand as the government aims to disburse at least 95% of that figure.

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  • Citi wins award for bank of the year in Asia Pacific

    Citi wins award for bank of the year in Asia Pacific

    Citibank has been honored as “Bank of the Year” in the Asia Pacific at the 2022 International Financing Review Asia Awards.

    The award was based on a unanimous decision by the editors of IFR Asia, a leading regional capital markets magazine.

    The recognition from IFR Asia reaffirms the expertise and solution-driven approach of Citi’s capital markets and advisory teams in developing and executing complex transactions for clients in an ever-changing and challenging macro-environment.

    “Citi’s pan- Asian footprint and diverse sector coverage made it a bastion of stability, while its commercial bank enabled it to give issuers more options in rapidly changing market conditions,” IFR Asia concluded in an editorial write up accompanying the award win.

    “This win is a recognition of the strength of Citi’s franchise, the competitive advantage of our global network and the passion and energy of our teams,” Jan Metzger, head of Asia Pacific banking, capital markets and advisory at Citi, said.

    In Vietnam, the bank recently won the 2023 Golden Dragon Award for its role as an outstanding foreign enterprise promoting green investment, digital transformation and sustainable development.

    Ramachandran A.S., Vietnam Citi Country Officer, said: “We have been financing and facilitating a wide array of climate solutions, from renewable energy and clean technology to carbon credits, to help accelerate the country’s transition to a low-carbon economy.

    “Our strategy in Vietnam is to continue doing what we do best: corporate and institutional banking for large companies and financial institutions with cross – border needs, and simultaneously supporting Vietnam’s ambitions to build a more sustainable future.”

  • Gold inches lower

    Gold inches lower

    SJC gold price dropped 0.22% to VND67.15 million ($2,855.14) per tael Wednesday morning.

    Gold ring price fell 0.53% to VND55.5 million per tael. A tael equals 37.5 grams or 1.2 ounces.

    Globally gold prices edged higher on Wednesday as the dollar eased, while investors kept a close watch on the U.S. Federal Reserve’s interest rate decision and policy outlook, Reuters reported.

    Spot gold was up 0.2% at $1,942.96 per ounce.

    Gold is traditionally considered a hedge against inflation, but higher rates increase the opportunity cost of holding the non-yielding asset.

    The dollar index was down slightly, making bullion less expensive for buyers holding other currencies.

    Markets will also take stock of the February UK inflation data, also due on Wednesday ahead of the Bank of England’s monetary policy decision on Thursday.

    U.S. Treasury Secretary Janet Yellen told bankers on Tuesday that she is prepared to protect depositors in smaller U.S. banks suffering deposit runs that threaten more contagion amid the worst financial system turmoil in over a decade.

     

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  • Japanese retailers expand in Vietnam, targeting affluent

    Japanese retailers expand in Vietnam, targeting affluent

    Targeting consumers is not much affected by the difficult economic situation, Japanese retailers are opening more stores in Vietnam.

    Uniqlo, which has 15 stores in Vietnam after entering three years ago, last month announced plans to expand to the southern province of Binh Duong, with a first store to be opened this spring or summer.

    Also in Vietnam for three years, MUJI opened a 2,000-square meter store in HCMC’s Thu Duc City that sells everything from food, home appliances and clothing to furniture, stationery and accessories.

    Even amid the Covid pandemic and economic distress, it had five stores, three in HCMC and two in Hanoi.
    Its stores in Vietnam are the largest at around 2,000 square meters on average.

    “The size in Vietnam is almost double the average in other countries, including Japan,” Tetsuya Nagaiwa, general director of MUJI Vietnam, said.

    He added that it plans to open more stores in Hanoi in the second quarter of this year.

    Aeon started building its seventh outlet in Vietnam in February in the central city of Hue. at a cost of U$169.67 million. It will be the largest mall in the central region when it opens by April 2025.

    A recent business survey by the Japan External Trade Promotion Organization found that 100% of Japanese retail businesses in Vietnam expect profits to increase this year.

    Of them 80% said they would expand in the next one to two years.

    Japanese retailers are doing well partly because, like everywhere else, high income earners in Vietnam are recession proof.

    “We see strong demand for high-value products,” Nagaiwa said, adding that MUJI’s sales remained good because young consumers prefer its stationery, cosmetics and furniture.

    Japanese chains also sell online shopping support made-in- Vietnam products.

    In November 2021 Uniqlo started selling online through an application, and introducing Vietnamese agricultural products.

    MUJI has steadily increased the local content rate and looked for local suppliers.

    Nagaiwa said goods made in Vietnam account for 30% of its products and 97-98% in the case of products like T-shirts, backpacks and messenger bags. “We hope these numbers will increase in future.”

    After discovering that the Vietnamese stationery market only had the popular and high-end segments and not the mid-range one, MUJI started selling ballpoint pens for VND19,000 ($0.8), attracting students, who liked Japanese goods with minimalist designs.

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